The Nasdaq is down almost 3%, especially its chip stocks, after Donald Trump said Taiwan should pay for its own defence. New Zealand’s soft inflation figures support earlier rate cuts. ANZ Research now sees a cut in November.
In our bonus deep dive interview ANZ Senior Asia Rates Strategist Jennifer Kusuma analyses the risks to economic growth in Asia over the second half of the year.
5 things to know:
The Nasdaq is down almost 3% as of 4 am Sydney/Melbourne time, especially its chip stocks. That’s after Donald Trump said Taiwan should pay for its own defence. All eyes are now on the ECB’s decision tonight, says ANZ Head of G3 Economics Brian Martin.
New Zealand’s CPI inflation fell from 4% to 3.3% in Q2, which was below the Reserve Bank’s forecast. Non-tradable inflation was 5.4% after a 0.9% quarterly rise. ANZ Economist Henry Russell says the data was reassuring, with ANZ bringing forward its call for the first OCR cut to November from February 2025.
British inflation is staying higher for longer than expected, thanks to sticky domestic inflation, and services inflation in particular. It was 5.7% in June from a year ago, says ANZ Economist Bansi Madhavani from London.
Bank Indonesia held its policy rate at 6.25% as expected, to continue support for the Rupiah. ANZ Economist Krystal Tan says there is scope for a rate cut in Q4 if external conditions are right.
Markets expect Australia’s June jobs figures today to show unemployment ticking up from 4 to 4.1%, and employment growth of 20,000. ANZ Senior Economist Blair Chapman says jobs growth could be stronger than May, and he expects unemployment to stay at 4%.
Cheers
Bernard
PS: Catch you tomorrow with those Australia jobs numbers and what they could mean for the RBA.
