Mixed US jobs data means the debate about a 25 basis point cut or a 50 point cut by the Fed next week still very alive. Australian home lending to investors is strong. Vietnam’s economy is in a sweet spot, with falling inflation and strong exports.
In our bonus deep dive interview, ANZ Senior Commodity Strategist Daniel Hynes looks at the implications for Australian iron ore producers from weakening Chinese steel demand.
5 things to know:
The Fed is still seen on track to start easing next week, either by 25 basis points or 50 basis points. US jobs grew 142k in August, a touch below the 165k consensus, but unemployment fell and wages growth nudged higher. ANZ Group Chief Economist Richard Yetsenga still thinks the Fed will cut 25 basis points.
The focus in Asian trade today will be on China CPI and PPI data, and then on Friday there’s China’s factory output, retail sales and investment data dump, says Richard.
Australian mortgage lending to investors in July was up 35% from a year ago and it’s nearly back up to its January 2022 peak, reports ANZ Economist Maddy Dunk.
Maddy says the rise in investor lending wasn’t purely because house prices have risen.
Vietnam’s annual inflation rate fell to 3.45% in August from 4.36% in July after a fall in food prices. ANZ Economist Kausani Basak says there’s little reason for monetary policy to react, given the economy is growing solidly.
Cheers
Bernard
PS: Catch you tomorrow as we look ahead to key US inflation data on Wednesday night and a likely rate cut by the European Central Bank on Thursday night.
