Global markets are on tenterhooks ahead of US jobs data tonight, looking for clues on the Fed’s rate cut path. ANZ Research pulls its RBA rate cut call forward to July after weak retail sales. And South Korea’s inflation rate may allow for one more rate cut.
In our Deep Dive interview, ANZ Economist Maddy Dunk analyses the recent pick up in Australia’s housing market.
5 things to know in 5 minutes:
US traders shrugged off ADP payrolls data showing a 33,000 fall in jobs in June, well below forecasts for a 100,000 rise. ANZ Group Chief Economist Richard Yetsenga says the official non-farm payrolls data tonight will be a critical component in the ‘patience-versus-July’ rate cut debate on the FOMC.
ANZ Research has updated its Reserve Bank of Australia rate cut call to July from August. ANZ Head of Australian Economics Adam Boyton says a cut next week is the path of least regret for the central bank’s board.
Adam has pencilled in another cut in August, but says the tone of the post-meeting statement and press conference will be important.
That call change followed the release of Australian retail sales data for May. Growth of 0.2% came in lower than market expectations. ANZ Economist Aaron Luk says the six-monthly annualised rate is at its lowest in 12 months.
South Korea’s headline inflation rate ticked up to 2.2% in June - above the central bank’s 2% target. ANZ Economist Krystal Tan says underlying inflation remains soft enough to continue rate cuts, with the core measure at 2%.
Cheers,
Bernard.
PS: Catch you tomorrow with analysis of what the US jobs data tonight could mean for the Fed’s rate cut path.
