Global stocks initially rose overnight on hopes for trade deals, but are off their highs in late US trade on confirmation China’s exports will face a 104% tariff within the day. The RBNZ is set to cut today, but will it be 25 bps or 50? And confidence surveys in Australia and New Zealand show confidence rebounded, but that was before the tariff news.
In our bonus deep dive interview, ANZ’s Group Chief Economist Richard Yetsenga says the market reaction to the US administration’s latest tariff announcements could result in a Trump pivot.
5 things to know in 5 minutes:
Global stocks are off their highs in late US trade after Donald Trump confirmed an extra 50% tariff on China within the next day, taking total China’s tariffs to 104%. The S&P 500 rose as much as 4% in early trade after bounces in Tokyo, Hong Kong and London in the wake of comments from US officials that trade deals could be done, says ANZ Economist Bansi Madhavani. But those gains evaporated this morning when the White House confirmed the extra 50% tariff would come into force at 2pm today Sydney/Melbourne time.
The Reserve Bank of New Zealand has a rates decision today. ANZ New Zealand Chief Economist Sharon Zollner is picking a 25 basis point cut to 3.5%. She says that was a near certainty until the US tariff announcement last week roiled markets, which brings a 50 bps cut into play.
The RBNZ will likely cast an eye over the latest NZIER Quarterly Survey of Business Opinion out yesterday in New Zealand. ANZ Senior Economist Miles Workman says the survey indicated some disinflation was still to come, but that the recovery had begun.
Two other pre-tariff confidence measures came out in Australia as well yesterday. ANZ Roy Morgan Consumer Confidence edged up again last week, by 1.5 points to 86.8, says ANZ Economist Sophia Angala.
And NAB’s monthly survey showed business conditions in Australia were stable in March. ANZ Senior Economist Adelaide Timbrell says the reading is already out of date, with forecasts and rate cut calls made after the tariff announcements.
Cheers,
Bernard
PS: Catch you tomorrow with analysis of the RBNZ’s rate decision.
