The Trump trade surge continues: Bitcoin hits a new record high and the US dollar bounced another half-percent overnight. Expectations for another Fed rate cut in December grow more wobbly, and weary ECB policy makers suggest rate cuts could help ward off negative US trade moves.
In our bonus Deep Dive interview, ANZ’s Head of Australian Economics Adam Boyton analyses a surge in jobs in aged care and disabled care, which is lifting female workforce participation.
5 things to know:
The Trump trade continued overnight. Bitcoin hit a new high above $84,000 and the US dollar stayed on its march upward. ANZ Economist Bansi Madhavani says the overhang of President-elect Trump’s win has been driving sentiment.
Amid the market moves, questions are growing as to whether the US Federal Reserve will follow last week’s rate cut with another in December. Bansi says guidance from the Fed, including that it will be closely watching two inflation reports between now and December, has been murky.
The positive US equities sentiment transferred to European stocks overnight - the broad Euro STOXX 600 index was up 1.1%. However, that’s amid growing concern about how the trading block can temper the negative effects of the new President’s trade policy. ECB member Yannis Stournaras said monetary policy will need to react.
Unlike in Australia, In New Zealand, workforce participation has dropped a bit as unemployment has increased. ANZ New Zealand Chief Economist Sharon Zollner says that’s meant the labour market is slightly tighter than the RBNZ was forecasting.
Sharon says that slightly tighter labour market, but without much extra wage pressure, is a factor reducing expectations for a really big rate cut by the RBNZ later this month.
Cheers
Bernard
PS: Catch you tomorrow with a look at the state of both Australian consumer and business confidence.
