US producer price inflation jumps to a three-year high, which lifts US bond yields and the US dollar. The Aussie and Kiwi dollars fall almost a percent. Australian jobs growth recovers, and New Zealand house prices fall again.
In our Deep Dive interview, ANZ FX Analyst Felix Ryan has been researching central bank currency holdings, including of the Aussie and Kiwi dollars.
5 things to know in 5 minutes:
The US headline Producer Price Index rose 0.9% in July from June, its fastest pace in three years. ANZ Economist in London Bansi Madhavani says the figures signal inflation is building up in the pipeline.
Australian employment growth rebounded in July after weakness across May and June. As a result, the unemployment rate ticked down from 4.3% to 4.2. ANZ Economist Aaron Luk says it was a solid jobs data print.
Employment rose 25,000. Aaron says the data came after a slight change in tone on the labour market from the Reserve Bank of Australia last week.
Aaron says there shouldn’t be too much change in the labour market from here into 2026, with ANZ Research forecasting an unemployment peak of 4.3% this year, and ending 2026 at 4.2%.
New Zealand house prices fell a seasonally adjusted 0.5% in July, according to Real Estate Institute data. There was also a fall in June, with the two months reflecting a softer economy, says ANZ Senior Economist Matthew Galt.
Cheers,
Bernard.
PS: Catch you next week as we get set for the Reserve Bank of New Zealand’s next rates decision.
