Weaker-than-expected US producer prices support rate cut bets ahead of key CPI data tonight. Australian wage growth is moderating, but only slowly. And it’s a ‘will they/won’t they’ monetary policy review day in New Zealand.
In our bonus deep dive interview, ANZ New Zealand Chief Economist Sharon Zollner looks ahead to that ‘live’ Monetary Policy Review for the Reserve Bank of New Zealand later today.
5 things to know:
A below-forecast rise in US producer prices boosted confidence overnight that the Fed can cut rates from September. ANZ Head of G3 Economics Brian Martin says markets are now looking for confirmation in soft CPI data tonight.
Australian wage growth data was both below and above expectations. Q2 growth of 0.8% was down from 0.9% in Q1, and just under the consensus forecast, but revisions nudged the annual rate to 4.1%, just above consensus. ANZ Senior Economist Catherine Birch says wage growth is easing - albeit gradually.
Recent award wage increases showed through in yesterday’s NAB Business confidence survey for July, with labour cost growth bouncing to a quarterly rate 2.5%, from 1.5% in June.
Japan’s Producer Prices rose for the sixth consecutive month in July. Eyes are now on Q2 GDP for further signs of inflationary pressure, says ANZ FX Analyst Felix Ryan.
In New Zealand, ANZ New Zealand Chief Economist Sharon Zollner says data yesterday showed the recent migration surge is turning downwards a bit faster than previously thought, which is a negative for GDP.
Cheers
Bernard
PS: Catch you tomorrow with reaction to that RBNZ rate decision, and US CPI.
