China’s stock markets rebounded overnight on a report of a US$278 billion plan to support stock values, but then faded. In Australia, the Federal Government is reported to be about to shift the mix of ‘Stage 3’ tax cuts towards lower to middle income earners.
In part two of our bonus deep-dive interview, ANZ’s Chief Economist for Greater China, Raymond Yeung, looks at the deflationary implications of growing numbers of unemployed migrant workers in China’s cities.
5 things to know
China’s stocks rebounded as much as 3.8% after a Bloomberg report of an official plan to support the market, but the rally faded on overseas investor scepticism, says ANZ’s Head of FX Research Mahjabeen Zaman.
The Aussie and Kiwi dollars, along with iron ore prices, bounced and then stalled overnight on the China stocks rescue plan report, says Mahjabeen.
Australia’s Federal Government is reported this morning to be about to shift the mix of already-legislated ‘Stage 3’ income tax cuts towards lower to middle income earners.
ANZ Australia’s Head of Economics Adam Boyton looks at the potential economic effects of the current version of tax cuts, and the sensitivities for spending, savings and growth of any changes. The detail and mix of the tax cuts and any extra cost-of-living relief is far from certain and Adam isn’t changing his view that the RBA is likely to cut in November.
The RBNZ will be watching for confirmation of slowing non-tradable inflation in NZ CPI data due today, says ANZ Australia Economist Henry Russell.
Cheers
Bernard
PS: Look out tomorrow for a deep dive interview with ANZ Head of G3 Economics Brian Martin on the euro’s 25th anniversary this month.
