US GDP is boosted by strong consumer spending while European growth beats expectations. Australian inflation falls - but rate cuts still aren’t on the cards for this year. And the Bank of Japan is expected to hold rates today against a backdrop of political uncertainty.
In our bonus Deep Dive interview, as Indonesia’s new President is finally sworn in following February’s election, ANZ Economist Krystal Tan looks at what his new policy priorities could mean for commodities and the state budget.
5 things to know:
The US economy grew 2.8% year-on-year in the third quarter. That was led by stronger consumer spending, which rose 3.7% - the fastest since early 2023. European GDP also accelerated in the third quarter, beating expectations to be up 0.9% from a year ago.
Australia’s headline inflation fell back within the RBA’s 2-3% target band in Q3, recording an annual rate of 2.8%. ANZ Senior Economist Catherine Birch says that was dragged down by temporary electricity rebates and imported fuel prices, and they key focus should be on the trimmed mean measure which remained above target at 3.5%.
Catherine says for there to have been any increased chance of a rate cut this year, inflation would have had to be much lower, given strength in Australia’s jobs market.
In New Zealand today, ANZ’s Business Outlook survey will be a key data point after a bumper lift in confidence in September to a ten-year high after the Reserve Bank began rate cuts. ANZ Group Chief Economist Richard Yetsenga says he’ll be watching to see if there’s any more flow through from further RBNZ cuts.
The Bank of Japan has a rate review today against the backdrop of political instability following the weekend’s election, and a weakening Yen. ANZ FX Analyst Felix Ryan says underlying price pressure should allow the BoJ to keep raising rates over the next year, although just not today.
Cheers
Bernard
PS: Catch you tomorrow with a review of that Bank of Japan rate decision.
