India’s election throws a curveball into the markets, with Narendra Modi’s BJP failing to secure a majority. US markets increase Fed rate cut bets after soft job openings data. Soft Australian net export figures could be a drag on GDP data out today.
In our bonus deep dive interview, ANZ Economist Dhiraj Nim outlines what India’s election result could mean for fiscal and monetary policy.
5 things to know:
US job openings declined in April to their lowest level since in 2021, suggesting labour demand continues to weaken, ahead of the important non-farm payrolls data at the end of the week. Markets are now pricing the chance of a September cut at 75%, up from 60% at the end of last week. Key in Australia today is GDP for the March quarter. ANZ Senior Economist Blair Chapman says weaker net export figures yesterday have led ANZ to reduce its quarterly forecast from 0.3% to 0.0%.
The Bank of Canada will be the first major central bank making a rates decision this month, when it meets tonight. ANZ FX Analyst Felix Ryan says markets are pricing in over a 90% chance of a cut in the key policy rate of 5.0%.
South Korea’s annual CPI inflation rate fell to a 10-month low in May of 2.7%, a touch below expectations. ANZ Head of Asia Research Khoon Goh says the decline looks set to continue.
The Philippines releases May CPI data later today. Khoon says inflation looks set to jump up to 4% annually.
And in Thailand, Khoon says annual inflation should tick up into the central bank’s target range, at 1.3% in May. It has been below the 1-3% range due to a weak economy.
Cheers
Bernard
PS: Catch you tomorrow with that Australian GDP data, and what it could mean for the RBA.
