Global markets are treading water this morning ahead of Congressional testimonies from Fed Chair Jay Powell and US CPI numbers. Meanwhile in Australia, housing lending dropped in May, dragged down by a sopping wet New South Wales.
In our bonus deep dive interview, ANZ Economist Maddy Dunk explains why Western Australia is performing so well in ANZ’s Stateometer report.
5 things to know:
Markets are in a holding pattern ahead of US Fed Chair Jerome Powell’s double testimony to Congress on Tuesday and Wednesday, and US June CPI on Thursday. The US dollar index was up slightly. ANZ Head of FX Research Mahjabeen Zaman says a softer inflation and labour market outlook in the US should take pressure off the US dollar over the next few weeks.
A key driver for the New Zealand dollar this week will be Wednesday’s Monetary Policy Review by the Reserve Bank of New Zealand. While the OCR is expected to be held at 5.5%, Mahjabeen says softer recent data and a shift towards policy easing should limit the Kiwi’s rise.
The Euro and European stock markets fell slightly overnight as traders weighed what a hung Parliament in France could mean for markets. Mahjabeen says the current situation is still holding markets above expectations ahead of the vote.
Housing lending in Australia fell unexpectedly by 1.7% in May from April, after three months of growth. ANZ Senior Economist Blair Chapman says loan growth so far in calendar 2024 is solid at 8.6%.
Blair says housing lending remained strong in Western Australia and Queensland, but Victoria was down, and New South Wales showed particular weakness as heavy rains dampened market activity.
Cheers
Bernard
PS: Catch you tomorrow with how markets reacted to US Fed Chair Powell’s first of two Congressional testimonies.
