US PPI inflation was a bit faster than expected in July, which pushed bond yields up on Friday night. But China’s economy continues to struggle, with loan growth slumping to a 14-year low.
In our bonus deep-dive interview in five minutes, ANZ’s NZ Chief Economist Sharon Zollner looks at whether the RBNZ can keep pausing its Official Cash Rate at 5.5%.
5 things to know
US producer price inflation of 0.3% in July was above the 0.2% consensus, which pushed up bond yields 7-9 basis points. ANZ’s Senior International Economist Tom Kenny thinks the Fed is still on track to pause next month.
New bank loans in China fell 89% in July from June to 346 billion yuan (US$48b), less than half market expectations. Also, Country Garden has suspended trade on 11 onshore bonds from this morning.
Food prices fell 0.5% in New Zealand in July, dragging annual food price inflation under 10% for the first time since September. ANZ Economist Henry Russell points to surprise falls in fruit and vege prices.
Brent crude oil prices hit a nine-month high of US$88 a barrel on Friday night after the IEA forecast record-high oil demand in 2023.
ANZ Group Chief Economist Richard Yestenga says central banks will be keeping a wary eye this week on resurgences in commodity prices.
Cheers
Bernard
PS: Tomorrow we’ll take a deeper dive into how El Nino is already affecting commodity prices and the economies in the Asia Pacific.
