5 in 5 with ANZ
5 in 5 with ANZ
Thursday: Fed rate cut bets pushed out
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-8:23

Thursday: Fed rate cut bets pushed out

Pricing for first full Fed cut now December; Australian inflation stronger than expected, while construction falls unexpectedly; Vietnam CPI rises; Budget day in NZ; Latest on China's property rescue

Fed rate cut bets are pushed out ahead of US economic and price data. Australian inflation was stronger-than expected in April, while construction fell surprisingly in Q1. Vietnam’s CPI is on the rise, and it’s Budget Day in New Zealand.

In our bonus deep dive interview, ANZ Senior China Strategist Zhaopeng Xing explains why moves in recent days to loosen home buying rules in China’s largest cities will do little to prop up demand.

5 things to know:

  1. Stock markets fell globally, while the US dollar firmed and Treasury yields rose overnight. ANZ Economist Bansi Madhavani says this was driven by a reassessment of when the US Federal Reserve will start cutting rates, with pricing for the first full cut now in December.

  2. In Australia, the April CPI indicator was stronger than expected at 3.6% annually. ANZ Senior Economist Catherine Birch says some of the recent disinflation in the indicator has really stalled.

  3. Catherine says a surprising 2.9% quarterly drop in Australian construction activity presents downside risks to Q1 GDP forecasts. Market forecasts had ranged from a flat result to a rise of 1.5%.

  4. Business confidence in New Zealand took another hit in May, according to the ANZ Business Outlook survey. But in this instance, bad news is good news - at least for the Reserve Bank, ANZ New Zealand Chief Economist Sharon Zollner says. There was a fall in pricing intentions.

  5. Vietnam’s CPI rose 4.4% annually in May, slightly below the consensus expectation but still at its highest level since January 2023. ANZ Economist Arindam Chakraborty says Vietnam reported its first trade deficit in nearly 2 years due to a 30% rise in imports, mostly of intermediate electronic items and machinery and equipment as supply chains are rejigged away from China.

Cheers

Bernard

PS: Catch you tomorrow with coverage of the New Zealand Government’s Budget.

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5 in 5 with ANZ
5 in 5 with ANZ
A daily podcast hosted by Bernard Hickey that gives you the five things you need to know about the global economy and markets in under five minutes. Plus a deep dive into emerging trends and issues featuring ANZ's global team of experts.