Oil prices surge after more Ukrainian drone attacks on Russian refineries. US stocks dip ahead of key retail sales data. The Bank of Japan is set to hike to 0.0% as wages surge. The ECB is seen cutting in June. NZ Q1 inflation may beat the RBNZ’s forecast.
In our bonus deep dive interview, ANZ Chief Economist for Greater China Raymond Yeung explains how a two-tier property system is emerging in China as authorities promote affordable housing over the private market, which could reduce a supply glut.
5 things to know:
Oil prices rose 1.6-2.8% overnight after Ukrainian drones hit two more Russian refineries. US stocks were down 0.2-0.5% at 5 am Sydney/Melbourne time, ahead of US retail sales data for February. ANZ Head of FX Research, Mahjabeen Zaman says a 0.8% bounce is expected after bad weather hit sales in January.
Japan’s ‘Rengo’ trade union confederation is expected to report 4-5% wage increases were secured in negotiations this month. The Bank of Japan is watching closely ahead of a possible 10 bps hike to 0.0% next Monday, or in April.
The UK economy grew 0.2% in January from December, led by strength in services and construction, which offset weakness in industrial production. ANZ Economist Bansi Madhavani says it looks like 2023’s recession is over.
European Industrial production fell 3.2% in January from December and 6.7% from a year ago. Markets are increasingly expecting the European Central Bank to cut rates from June, Bansi says.
NZ food prices in February were weaker than expected, but stronger domestic airfares and overseas accommodation costs mean there’s a growing chance March quarter inflation of 0.6% beats the RBNZ’s forecast for 0.4%, says ANZ Economist Henry Russell.
Cheers
Bernard
PS: Catch you on tomorrow with analysis of US February retail sales, and what it might mean for the US Fed.
