The Dow rises through 40,000. Fed speakers see monetary policy working. US jobless claims and factory output data reinforce hopes for a rate cut or cuts later this year. Australia’s labour market may be softening faster than the RBA is expecting.
In our bonus deep dive interview, following on from our coverage of China’s politburo declaring they want to reduce unsold property inventories, ANZ Chief Economist for Greater China Raymond Yeung say they need to be careful from a financial stability perspective that prices don’t drop too much.
5 things to know:
The Dow briefly rose over 40,000 and the S&P 500 also nudged up to new record highs, with markets more confident the Fed can cut this year after a week of data showing a soft CPI, flat retail sales, rising jobless claims and falling factory output, says ANZ Economist in London Bansi Madhavani.
Australia’s unemployment rate rose to 4.1% in April from 3.9% in March, slightly above market expectations. But jobs growth outperformed estimates at 38,500. ANZ Head of Australian Economics Adam Boyton says that meant a neutral print overall.
Adam says a 0.8% fall in annual hours worked caught his eye. There have only been larger falls during the pandemic, the GFC and the early 2000s slowdown.
Japan’s GDP contracted 0.5% in the March quarter, to be down 2% over the year due to weakening consumption and car exports. ANZ FX Analyst Felix Ryan says that was well below expectations for a 1.2% annual drop.
The Philippines central bank kept its key policy rate on hold at 6.5% yesterday for the fifth meeting in a row. ANZ Chief Economist for Southeast Asia and India Sanjay Mathur said the Bangko Sentral ng Pilipinas did reduce its 2024 risk-adjusted inflation forecast slightly, but remained on the hawkish side.
Cheers
Bernard
PS: Catch you next week with a Reserve Bank of New Zealand OCR decision on Wednesday.
