Oil prices are down as much as 7%, while stocks are up on Middle East peace talk hopes. The Reserve Bank of Australia warns rates may not be high enough to tame inflation, and Singapore tightens monetary policy.
And then in our deep-dive interview, ANZ Senior Commodities Strategist Daniel Hynes analyses the US blockade of the Strait of Hormuz and outlines ANZ Research’s new oil price forecast.
5 things to know in 5 minutes:
Oil prices were down 4% to 7% overnight, while US stocks rose back towards record highs as traders reacted to headlines about renewed Middle East peace talks. But the US blockade of the Strait of Hormuz continues. The US said six boats were turned around overnight. Meanwhile, US Producer Prices rose by 0.5% in March from February, which was less than expected, says ANZ Economist Bansi Madhavani.
Bansi says the PPI and last week’s CPI are a useful gauge for how the Fed’s favoured PCE inflation measure will fare in March. ANZ Research expects it to be firmer, but she says it’s encouraging that higher energy prices have not spilled over into broader producer prices.
Reserve Bank of Australia Deputy Governor Andrew Hauser has said the RBA does not yet have confidence it had set rates at the right level to tame the recent inflation spike, and they would go higher if needed. ANZ Economist Sophia Angala says the comments come as ANZ-Roy Morgan consumer confidence inflation expectations showed a slight dip last week.
Australian business confidence fell to minus 29 points in NAB’s March survey. Sophia says that’s the lowest in six years and the largest monthly drop since the start of COVID.
The Monetary Authority of Singapore tightened monetary policy yesterday by lifting the rate of appreciation in its currency band. ANZ Head of Asia Research Khoon Goh sees another tightening in July.
Cheers
Bernard.
PS: Catch you tomorrow with a look ahead to Australia’s March jobs report.
