1. Economic Update Dr Ron Woods Challenger Financial Services Group 22 November 2006

2. House prices annual % change -10% 0% 10% 20% 30% 40% 50% Dec.00Dec.01Dec.02Dec.03Dec.04Dec.05Dec.06 0% 10% 20% 30% 40% 50% 60% Hobart only Perth Brisbane Adelaide Sydney Melbourne Hobart, only city on right axis

3. Net job creation 2 yrs to housing peak*

4. Final demand by state, % annual change 1% 2% 3% 4% 5% 6% Jun-03Dec-03Jun-04Dec-04Jun-05Dec-05Jun-06 1% 2% 3% 4% 5% Australia, left axis Aust less WA & QLD, right axis

5. Comex copper futures

6. Comex oil futures

7. Theoretical Phillips curve

8. PC incorrect: Phillips curve since ’90s

9. Australian yield curve (10-yr minus 3-yr)

10. Email to roneconomics@hotmail.com

11. Disclaimer The information contained in this presentation is current as of 10 November unless otherwise specified and is intended solely for licensed financial advisers. It is issued by Challenger Managed Investments Limited ABN 94 002 835 592 AFSL 234668. It must not be passed on to a retail client except where it is included as part of the financial adviser’s own advice to the client and is not accredited to Challenger. It should be regarded as general information only rather than advice. It has been prepared without taking account of any person’s objectives, financial situation or needs. Offers of interests in any Challenger product are contained in the current Product Disclosure Statement which is available on our website (www.challenger.com.au) and must be considered before making a decision about the product. Past performance is not a reliable indicator of future performance.

12. Monetary policy scorecard