The Euro falls on growing concerns that France’s minority Government will face a no-confidence vote as it forces through a Budget bill. Australian retail sales are stronger than expected due to early discounting, and New Zealand building consents stabilise.
In our bonus deep dive interview, ANZ’s Head of Asia Research Khoon Goh explains why he now expects a fifth consecutive year of depreciation for Asian currencies against the US dollar.
5 things to know:
The Euro fell overnight as France’s minority government used a constitutional provision to pass a budget bill, after opposition parties resisted tax increases and budget cuts. ANZ Head of G3 Economics Brian Martin says that opens up a vote of no-confidence. New elections can’t be held until July 2025, meaning over half a year of budget uncertainty.
The Chinese yuan and the Australian dollar have moved together and down against the US dollar in recent days. ANZ Head of FX Research Mahjabeen Zaman says that’s partly on concern about what Trump’s tariff threats might mean for trade between the United States and the world’s second biggest economy, China, which is Australia’s largest export market.
The final components of Australian GDP for the September are reported today, including Government finances and Australia’s external accounts. ANZ’s Head of Australian Economics Adam Boyton is putting the finishing touches on his GDP forecast for the figures due tomorrow, which the RBA will be watching closely, in particular unit labour costs.
Australian retail sales were stronger than expected in October, rising 0.6% from September, above the consensus forecast for 0.4%. ANZ Economist Sophia Angala says retailers appear to have enticed people to spend up ahead of Black Friday, through early discounting.
New Zealand building approvals fell 5% in October, slightly weaker than expected but not outside of typical monthly volatility, says ANZ Economist Henry Russell. Henry says there has actually been a stabilisation in consents in recent months.
Cheers
Bernard
PS: Catch you tomorrow with a final preview of Australian GDP.
