The Australian and New Zealand dollars weakened sharply overnight against ‘King US Dollar’, which was helped by stronger-than-expected US factory output data lifting US bond yields.
In our bonus deep-dive interview, ANZ’s Chief Economist for Southeast Asia and India Sanjay Mathur unpacks the rebound in consumer spending in the region after Covid.
5 things to know
The A$ fell overnight to as low as 63.6 USc, it’s lowest level since Covid struck in March 2020. ANZ’s Head of G3 Economics Brian Martin cites the strong US dollar and the RBA’s comments about a ‘soft landing.’
The RBA held its cash rate at 4.1% and left open the option of hiking rates, but ANZ’s Head of Australian Economics Adam Boyton noted its talk about about a ‘soft landing.’
Adam forecasts Australian GDP data due today to show growth of 0.4% in Q2 as firm Government spending offsets weak household and business activity.
The Reserve Bank of India has a particular risk that sticky rice inflation becomes embedded in inflation expectations, says Sanjay Mathur.
ANZ’s China Economist Betty Wang says a move by authorities to boost affordable housing development suggests a move to a ‘Singapore-model’ for public housing.
Cheers
Bernard
PS: Look out tomorrow for an analysis of Australian GDP in the June quarter.
