The Reserve Bank of New Zealand is expected to hike tomorrow for the first time in more than three years, but expectations are split. Australian job ads are stable, and Thailand’s headline inflation rate is below forecasts.
In our deep-dive interview, ANZ Economist Krystal Tan unpacks how a very strong El Nino could ripple across Southeast Asia’s economies into inflation and lower incomes. And one size does not fit all.
5 things to know in 5 minutes:
The Reserve Bank of New Zealand (RBNZ) will decide tomorrow on whether to hike the Official Cash Rate for the first time in more than three years. The last decision six weeks ago by the six-member monetary policy decision was evenly split three votes to three between a hold and a hike, with only the casting vote of Governor Anna Breman deciding to hold at 2.25%. ANZ New Zealand Chief Economist Sharon Zollner expects a hike to 2.5%, but says markets see a 70-75% chance of a hike.
Sharon says the RBNZ needs to start getting the cash rate back to neutral.
Sharon says oil prices have fallen, but the RBNZ has to look beyond that, including to a lower New Zealand dollar and business expectations of price increases.
The ANZ Indeed monthly job ads survey in Australia found hiring was broadly stable in June, falling 0.2% from May and being up 0.5% from a year ago. ANZ Economist Aaron Luk says job ads remain 28% down from their late 2022 highs, but well above pandemic lows. He expects unemployment to rise.
Thailand’s headline annual inflation rate fell to 2.42% in June from 2.72% in May, which was a softer result than expected, largely due to softer transport inflation linked to lower oil prices. But ANZ FX Analyst Kausani Basak says there’s more heat beneath the surface.
Cheers,
Bernard.
PS: Catch you tomorrow with a closer look at how Australia’s states are performing with ANZ Economist Sophia Angala.
