US markets bounced overnight after traders took stock of stronger-than-expected inflation, and as a Fed President said higher monthly inflation was still consistent with the Fed’s 2% target.
In our bonus deep dive interview, ANZ Senior Economist Blair Chapman explains why full time employment growth in Australia might be set to taper off, and what that could mean for the RBA.
5 things to know:
US markets firmed overnight as traders digested yesterday’s stronger-than-expected inflation data, with the Aussie and Kiwi dollars rising too. ANZ’s Head of G3 Economics Brian Martin says comments from the Fed’s Chicago President helped drive the bounce.
Euro zone GDP held steady at the end of 2023, reaffirming ANZ’s view for an April rate cut by the ECB, Brian says. Slower UK inflation increased expectations for a mid-year cut by the Bank of England.
Ahead of Australian jobs figures today, ANZ Senior Economist Blair Chapman says the RBA will be watching the seasonally adjusted data closely because of changes in employment patterns after Covid.
New Zealand house prices rose 1% in January, while sales were the second lowest on record. ANZ economist Andre Castaing says first home buyers remain wary because of higher mortgage rates.
New Zealand’s early look at a selection of price movements showed weaker-than-expected tradable inflation in January. ANZ Economist Henry Russell says the RBNZ will be more focused on non-tradable inflation.
Cheers
Bernard
PS: Look out tomorrow for reaction to Australia’s jobs figures out later today.
