ECB rate cut bets were boosted after its French Governor suggested a July cut could follow straight after June. Chinese industrial profits rose in April, rebounding from weakness in March. We also look at recent falls in the Yuan and Philippine Peso.
In our bonus deep dive interview, ANZ Head of FX Research Mahjabeen Zaman reveals what happened to the US dollar before and during the last eight Fed easing cycles.
5 things to know:
The EuroStoxx 600 index closed up 0.3% after the ECB’s French Governor said consecutive rate cuts in June and July shouldn’t be ruled out. Meanwhile in China, profits at large industrial firms rose 4% in April from a year ago.
Chinese authorities have allowed the Yuan’s daily reference rate to weaken to its lowest level since January. ANZ Head of Asia Research Khoon Goh says the slide is being caused by more than just the strong US dollar.
The main focus for markets in New Zealand’s budget on Thursday will be the amount of extra borrowing by the new Government, says ANZ’s New Zealand Chief Economist Sharon Zollner.
The Philippines Peso has fallen to close to its record low of 59 to the dollar back in 2022. It started 2024 at 55.4. Khoon says dovish comments from the central bank, the BSP, drove the latest weakness.
New Zealand monthly ‘filled jobs’ data due today will be watched for signs the labour market is weakening, something Sharon says the Reserve Bank needs to help take demand out of the economy.
Cheers
Bernard
PS: Catch you tomorrow with Australian retail sales data and a look ahead to the CPI.
