Start your day with the NAB Morning Call for the latest overnight key economic and market information straight from our team of expert market economists and strategists. This includes perspective on overnight news and market price action and the forces shaping movements in Australian and global markets in the days ahead.
Big from Japan
Wednesday 21st December 2022NAB Markets Research Disclaimer Financial Services Guide | Information on our services - NABThe Bank of Japan has broadened the tolerance for its yield control curve target. NAB’s Ray Attrill says it surprised markets because Governor Kuroda had previously stated they wouldn’t be doing that. So, why the change and why has it had such an impact on global bond and currency markets? The Australian dollar fell against a US dollar which was itself falling, in part because of the RBA minutes yesterday. We look at what was discussed. And in New Zealand, business confidence hit an all-time low (well since the survey started in the eighties). Also,
20/12/2022 • 18 minutes 6 seconds
Last minutes before Christmas
Tuesday 20th December 2022NAB Markets Research Disclaimer Financial Services Guide | Information on our services - NABThere are only five sleeps to Christmas, but central banks are still cramming in what they can to position markets for the start of 2023. The ECB is ramping up its hawkish messaging, whilst the Fed continues to deny that they will start reversing rates next year, even as the housing market struggles. The RBA, meanwhile, is giving very little away, which is why there is more than the usual interest in the minutes of the last meeting out today. Plus, the Bank of Japan meets with a likely review of their monetary approach and China is promising targ
19/12/2022 • 19 minutes 32 seconds
US services slide, whilst China promises a J-curve recovery
Monday 19th December 2022NAB Markets Research Disclaimer Financial Services Guide | Information on our services - NABThere wasn’t much risk appetite at the end of the week, after a hawkish Fed and the same from the ECB. It still seems markets doubt the Fed will go all the way to 5.1% and are looking for reasons to assume they will relent earlier. NAB’s Skye Masters says the inversion in the Treasury yield curve will remain for some time, but wonders how much of this is being drive by the after effects of QE. Meanwhile China is planning a major comeback next year, with one official at their Central Economic Work Conference last week describing a J-curve recovery.<
18/12/2022 • 12 minutes 36 seconds
Hawks fly over frigid Europe
Friday 16th December 2022NAB Markets Research Disclaimer Financial Services Guide | Information on our services - NABAs the UK and Europe weather a cold snap, central banks are heating up their rhetoric as the fight to cool inflation. On today’s podcast JBWere’s Sally Auld discusses the unexpectedly hawkish stance taken by the ECB, suggesting it was possibly a trade-off from pushing rates higher this time round. The Bank of England was split three ways on what to do, but ultimately lifted rates by the same amount – 50 basis points. We also look at moves by the Norges Bank and the Swiss National Bank. Meanwhile, Australia’s strong employment numbers add further p
15/12/2022 • 21 minutes 59 seconds
Hawkish Fed with higher rates for longer
Thursday 15th December 2022NAB Markets Research Disclaimer Financial Services Guide | Information on our services - NABMarkets weren’t surprised by the FOMC raising rates by 50 basis points this morning – a unanimous decision by the board. But members are more divided on where to go next, with the Fed now predicting a median rate of 5.1 percent by the end of next year, even with talk of inflation having peaked. NAB’s Gavin Friend says this rise in the dot plot is based on continued labour market tightness. It could be a different picture for the Bank of England later today, and the ECB where wage inflation is not such a concern. In a feverishly busy day we also get A
14/12/2022 • 15 minutes 47 seconds
Christmas comes early with cooler US inflation
Wednesday 14th December 2022NAB Markets Research Disclaimer Financial Services Guide | Information on our services - NABUS CPI numbers came in lower than anticipated, leading to the inevitable question about whether inflation has peaked, just in time for tomorrow’s FOMC meeting? The market response was swift fall in two-year Treasury yields and a rise in equities, although much of those gains has been pared back since. NAB’s Taylor Nugent says it creates a challenge for Jerome Powell, who will want to acknowledge the good news but remind markets there is still a long way to go. So, perhaps, tomorrow, he will be the Grinch who stole Christmas.<p style='c
13/12/2022 • 15 minutes 16 seconds
US equities bounce ahead of a divided Fed
Tuesday 13th December 2022NAB Markets Research Disclaimer Financial Services Guide | Information on our services - NABUS equities have bounced back, but the rise in the VIX index, which measures market volatility, is perhaps a better measure of where we are ahead of the FOMC meeting this week. It’s risen, highlighting uncertainty about how far the US central bank will go. Nick Timiraos describes a very divided Fed in the Wall Street Journal this morning. Also today, NAB’s Ray Attrill takes us through yesterday’s UK GDP numbers, with employment data out later ahead of the BoE meeting later in the week. Plus, the NAB Business Survey out later today.<
12/12/2022 • 16 minutes 48 seconds
US producer prices spark inflation worries ahead of the Fed
Monday 12th December 2022NAB Markets Research Disclaimer Financial Services Guide | Information on our services - NABIt’s a big week for central banks – the Fed, the BoE and the ECB amongst them. Plus US inflation numbers. There’s some hope that the US will head off a hard landing, with inflation expectations falling in the Michigan Consumer Sentiment survey on Friday, although producer prices showed a different story, adding to the US risk-off sentiment at the end of the week. So we can expect another volatile few days, but who will be the winners and the losers? NAB’s Tapas Strickland provides valuable insights to guide you into this busy week.<p styl
11/12/2022 • 16 minutes 5 seconds
Slight risk bounce as US markets “clutch at straws”
Friday 9th December 2022NAB Markets Research Disclaimer Financial Services Guide | Information on our services - NABThere was a bit more of a risk-on attitude in the US overnight, with equities rising for the first time in five days. Part of the reason could be a rise in jobless claims. But NAB’s David de Garis says you’d be clutching at straws to assume that means lower inflation and a less aggressive Fed. It’s just part and parcel of the volatility ahead of a bumper week next week, with US CPI, the FOMC meeting and the ECB. The last blast before Christmas. Equally as unexplained is the slow glide down in oil, when there’s every reason for it to be heading the
08/12/2022 • 17 minutes 59 seconds
Thursday 8th December 2022NAB Markets Research Disclaimer Financial Services Guide | Information on our services - NABUS bond yields fell further overnight as US wages data showed slower growth than anticipated, adding to hopes that the Fed won’t be as aggressive as they’ve been letting on when it comes to future hikes. NAB’s Gavin Friend says that does seem to be the mood of the moment. Whilst the Bank of Canada raised rates by 50 basis points – when many had considered 25 was likely – it was a dovish rise, with suggestions that they won’t be doing too much more. The RBA is moving in smaller increments, and whilst a pause is not on th
07/12/2022 • 15 minutes 53 seconds
No surprises from RBA but BoC on a knife-edge
Wednesday 7th December 2022NAB Markets Research Disclaimer Financial Services Guide | Information on our services - NABUS and European equities have taken another hit. NAB’s Ken Crompton says markets continue to respond to the strong jobs data from the US on Friday and what that means for terminal Fed rates. There were no surprises from the RBA yesterday, with NAB’s Ivan Colhoun saying the central bank is very cognisant of lags in monetary policy, so it’s too early to expect any pause in the first part of next year. It’s a different story for the Bank of Canada tonight – who front-loaded hikes and the question is how close are they to reaching the end of their tighte
06/12/2022 • 16 minutes 28 seconds
Fed’s terminal rate, heading higher?
Tuesday 6th December 2022NAB Markets Research Disclaimer Financial Services Guide | Information on our services - NABIf you believe the ISM numbers this morning, the US services sector is growing faster than anticipated. Yet the PMI measure, supposedly monitoring exactly the same activity, showed the sector is slowing. So, who do you believe? NAB’s Tapas Strickland says markets were taking a more cautious approach before the ISM number after a WSJ article suggested the Fed might indicate a higher terminal rate at their meeting next week. A 25bps rise is expected from the RBA today even as indicators suggest private sector labour costs are rising.<p styl
05/12/2022 • 16 minutes 4 seconds
The Central Bank Dilemma - is it working?
Monday 5th December 2022NAB Markets Research Disclaimer Financial Services Guide | Information on our services - NABThe US non-farms payrolls numbers on Friday were an upside surprise for the number of jobs created and the increase in wages – both factors the Fed has been trying to control. Is the policy working? NAB’s Taylor Nugent says markets have responded with the expectation of a deepening recession as the Fed pushes harder.Canadian employment numbers were also stronger than expected on Friday, so how does that impact the Bank of Canada’s rate decision this week? And, before that, the RBA – what’s their plan? Just because you’ve started opening
04/12/2022 • 18 minutes 17 seconds
So, what did markets like about Powell’s speech yesterday?
Friday 2nd December 2022NAB Markets Research Disclaimer Financial Services Guide | Information on our services - NABMarkets have not significantly retraced their moves after Jerome Powell’s speech yesterday. Equities have rebounded only slightly and bond yields have continued to fall. On today’s podcast NAB’s Tapas Strickland outlines why his speech created a more positive risk outlook. There was good news in amongst the data released overnight too, with ISM manufacturing showing a fall in prices paid. Abd China’s lockdowns could be easing further, with home detention now replacing quarantine centres for low-risk cases in Beijing. The focus tonight, of course, will b
01/12/2022 • 16 minutes 6 seconds
Powell slightly less than very hawkish
Thursday 1st December 2022NAB Markets Research Disclaimer Financial Services Guide | Information on our services - NABIt’s been a busy session, with NAB’s Taylor Nugent claiming Jerome Powell’s speech this morning was slightly less hawkish than markets were expecting. But the Fed chair still talked about there being a way to go to fight inflation and the need for sustained evidence of falling inflation before the battle is won. Signs of easing inflation in Australia should also be treated with caution, with yesterday’s new monthly data susceptible to the volatility we don’t see in the quarterly numbers. In Europe though markets have reacted favourably to falling infl
30/11/2022 • 18 minutes 16 seconds
China calms down, European inflation eases
Wednesday 30th November 2022NAB Markets Research Disclaimer Financial Services Guide | Information on our services - NABThe Aussie dollar has benefited from a reversal in concerns over China. NAB’s Ray Attrill says an announcement of a more intense vaccination program for older people has markets assuming a recovery in the Chinese economy early next year. Germany’s inflation numbers came out lower than anticipated with the assumption that we will see a Europe-wide slowdown in data released data. It’s a different story for Australia though (although obviously from a lower base) with inflation expected to rise today, with NAB forecasting a greater rise than the consens
29/11/2022 • 14 minutes 5 seconds
Big Trouble in Zero-COVID China
Tuesday 29th November 2022NAB Markets Research Disclaimer Financial Services Guide | Information on our services - NABChina is losing out on two fronts. It can’t keep its COVID numbers down and now its facing protests in major cities, which could add to the slowdown in the Chinese economy and, as JBWere’s Sally Auld suggests, it could delay the speed of the global recovery. We’ve already had two Fed speakers overnight suggesting rates might be higher for longer than markets are expecting. In Europe Christine Lagarde continues to take a hawkish stance (just ahead of Euro area inflation numbers), whilst the RBA’s Philip Lowe has been forced to apologise for mislea
28/11/2022 • 17 minutes 25 seconds
China unrest hits Aussie dollar in early trade
Monday 28th November 2022NAB Markets Research Disclaimer Financial Services Guide | Information on our services - NABUnrest is growing in China over the zero COVID policy, with protests over the weekend in Shanghai following deaths from an apartment fire, supposedly locked down. NAB’s Rodrigo Catril says we’ve already seen a response to this news with a fall in the Australian dollar as the market opened. Friday saw a sell-off in European bonds as the ECB sounded ever hawkish, and an increase in the pricing of a 75bps hike at the next meeting. And the numbers are in for Black Friday sales – they are at record levels but given the current inflation levels that’s not re
27/11/2022 • 14 minutes 42 seconds
ECB minutes, little action, no spoilers
Friday 25th November 2022NAB Markets Research Disclaimer Financial Services Guide | Information on our services - NABAs you might expect, with Thanksgiving still going on in the US and everyone else watching the world cup it’s been a quiet session overnight. Still. NAB’s David de Garis joins in today to talk through the ECB minutes, Germany’s IFO numbers, the Riksbank’s interest rate decision and China’s likely response to record COVID numbers. There’s also a no-spoiler guarantee, for those recording the soccer to watch later. Hosted on Acast. See <a style='color:grey;' target='_blank' rel='noopener norefer
24/11/2022 • 13 minutes 42 seconds
Softer data, slower Fed and more Russian oil
Thursday 24th November 2022NAB Markets Research Disclaimer Financial Services Guide | Information on our services - NABThere’s a higher risk appetite again this morning, driven by the release of the FOMC minutes which NAB’s Gavin Friend says more or less confirmed that the Fed will lift rates by 50 bps at the December meeting. Before that, the response was to mixed data, with PMIs weaker than anticipated but strong US durable goods orders. There’s also an expectation that Russian supplies of oil might be higher than anticipated as the G7 and EU seem set to set the cap around $65-70, well above the cost of production. That might be good for inflation but a disaster in
23/11/2022 • 18 minutes 37 seconds
One more pivot before Thanksgiving
Wednesday 23rd November 2022NAB Markets Research Disclaimer Financial Services Guide | Information on our services - NABAmerica will be sitting down to a Turkey dinner tomorrow, but before that markets seem to be determined to spread hope of a pivot from the Fed – or at the very least a slowdown in rates. That’s helped equities overnight and whilst treasury yields are falling. NAB’s Skye Masters says it’s unlikely the Fed will be happy to see this sort of price action, it isn’t the message they are trying to send to markets. Less attention sems to be given to rising COVID numbers in China, which are now close to their all-time high in April and are resulting n more l
22/11/2022 • 16 minutes 57 seconds
Oil, more or less?
Markets are still concerned about lockdowns in China, evidenced by the fall in US equities and a 2% drop in Apple’s share price. Oil has also been falling, but NAB’s Ray Attrill says the prospect of an increase in production by OPEC+ next month pushed prices lower for a while before people started asking, ‘why would they do that?’. The argument was it was to compensate for lost Russian oil as sanctions hit, with news reports that G7 and the EU might this week agree on the price cap beyond which they will not ship or insure Russian oil, irrespective of the destination. There’s also discussion today on the fall in German producer prices, what the RBNZ will do tomorrow and what the RBA’s Philip Lowe will say over dinner tonight.Incidentally, today NAB trade donate the proceeds of today’s trading revenue to First Nations Foundation, to support the financial literacy of Indigenous communities. Or you can make a donation. Go to <a href="http://www.nabtrade.com.au/charityday" re
21/11/2022 • 16 minutes 18 seconds
A rare dull day
Monday 21st November 2022NAB Markets Research Disclaimer Financial Services Guide | Information on our services - NABFriday was unusually quiet, with no big data releases and not much movement in markets. As NAB’s Tapas Strickland observes, the most significant move was the reversal in short-end yields, taking the 2-10 yield spread to minus 70bps, the highest negative spread in over forty years. Normally this would be a clear signal of an impending recession, he says, but we’ve been seeing these signs for most of the year and yet the economy remains surprisingly resilient. The last week has also seen significant falls in oil prices – we look at why. And look ahead to
20/11/2022 • 16 minutes 19 seconds
Tighter than ever
Friday 18th November 2022NAB Markets Research Disclaimer Financial Services Guide | Information on our services - NABAnother 32 thousand Australians had a job in October, making the labour market the tightest it’s been in decades. NAB’s Ken Crompton says this cements in the expectation that the RBA will lift rates by at least 25 basis points in December, continuing on in the first meetings of the new year. There’s less expectation of the Fed slowing down as well, thanks to James Bullard suggesting interest rates could rise as high as seven percent. That’s hit equities and pushed bond yields higher. In the UK the new Chancellor managed to issue a budget without a mass
17/11/2022 • 16 minutes 46 seconds
Back to betting on the Fed; no pause for RBA?
Thursday 17th November 2022NAB Markets Research Disclaimer Financial Services Guide | Information on our services - NABThankfully, World War 3 wasn’t started by that missile strike on Poland. Now markets are back to betting on how far the Fed will go, rather than NATO. As NAB’S Gavin Friend discusses yesterday’s US retail numbers shows greater resilience than anticipated, adding to the work of the FOMC to moderate demand. Moderating demand is less of an issue in the UK, where headline inflation has hit 11.1 percent and household pressures will be hit even more with a cost cutting, high taxing budget expected later today. On the home front, could the evidence of wage
16/11/2022 • 17 minutes 4 seconds
A step too far
Wednesday 16th November 2022NAB Markets Research Disclaimer Financial Services Guide | Information on our services - NABJust as we pressed the record button on this morning’s podcast news broke that Russia had fired missiles into Poland, a NATO m ember. As JBWere’s Sally Auld explains, until that point market sentiment had been very positive, as producer prices in the US eased, adding to expectations that inflation had peaked. The missile strike was a stark remainder of what was one of the major causes of the inflation I the first place and that conflict is far from over. Locally the Australian Wage Price Index is released today and is expected to show wage pressures
15/11/2022 • 17 minutes 52 seconds
A slight reality check
Tuesday 15th November 2022NAB Markets Research Disclaimer Financial Services Guide | Information on our services - NABAfter the ebullient mood at the end of last week markets retraced their steps a little today, with shares on the rise and the US dollar regaining territory. NAB’s Rodrigo says Fed speakers, in particular Waller, have reminded the market that they will continue to lift rates until there are clear signs of a sustained drop in inflation. The question is, how determined will they be as we start to see more signs of a slowdown? The response to the easing of lockdowns in China seems to have persisted, with the Hang Seng strong yesterday and the Aussie dolla
14/11/2022 • 18 minutes 21 seconds
Monday 14th November 2022NAB Markets Research Disclaimer Financial Services Guide | Information on our services - NABThere was a trifecta of good news at the end of last week that sent equities rising, bond yields falling, commodities looking up and a chance for other currencies to gain on the US dollar at last. But will it last? That’s a question put to NAB’s Ray Attrill on this morning’s podcast. China announced some easing of COVID restrictions, Russia has backed out of Kherson and markets were still rejoicing with the fall in one month’s CPI read in the US. None of those translate to a fast track to a world that’s COVID free, with peace in Ukraine and price
13/11/2022 • 17 minutes 31 seconds
A welcome relief
Friday 11th November 2022NAB Markets Research Disclaimer Financial Services Guide | Information on our services - NABUS core inflation dropped to 6.3% in October, below expectations and down from 6.6% in September. NAB’s David de Garis joins Phil to talk through the market reaction, which has seen stocks soar, bond yields fall and the US dollar taking a big hit. Does this mean inflation has peaked? Dallas Fed’s Lorie Logan called it a ‘welcome relief’ but the message from other speakers overnight is that there’s still a lot of work to be done. In Europe the central bank seems to be upping its hawkish rhetoric, whilst the UK is still stuck with the uncertainty of a shrinking economy a
10/11/2022 • 17 minutes 10 seconds
Thursday 10th November 2022NAB Markets Research Disclaimer Financial Services Guide | Information on our services - NABIt’s inflation day. The CPI print is out from the US late tonight Australia time. On today’s podcast NAB’s David de Garis talks about the impact if the number is a little higher than expected. The Fed’s John Williams said overnight that the news for the US is “mostly good”, suggesting longer-run inflation expectations have remained remarkably stable. No doubt his goal was to prevent an overreaction to the numbers tonight, which will be followed by a slew of other Fed speakers in the hours that follow. There’s also a discussion about China’s producer prices on the podcast. They’re falling. Could we see China started to export deflation again? Not if they keep locking cities down. Hosted on Acast. See <a style='color:grey;' target='_blank' rel='noopener noref
09/11/2022 • 16 minutes 7 seconds
Downturns, mid-terms, no u-turns
Wednesday 9th NovemberNAB Markets Research Disclaimer Financial Services Guide | Information on our services - NABUS equity markets have switched from being upbeat about the prospect of an end to China’s zero COVID to being upbeat about the outcome from today’s mid-term elections. NAB’s Ray Attrill also talks about the differences between Australian consumer and business sentiment and why the business outlook always seems a little rosier. He also discusses how one central banker at least reckons a recession will increase inflation, whilst there’s some hope that falling producer prices from China today might dampen inflation expectations a little, as more cheaper good
08/11/2022 • 17 minutes 29 seconds
An end to China’s Zero COVID, or not?
Tuesday 8th November 2022NAB Markets Research Disclaimer Financial Services Guide | Information on our services - NABWe didn’t see the expected turnaround in markets on Monday. Yesterday on the Morning Call we talked about how Chinese officials had denounced speculation that they were heading away from the Zero COVID road soon, so we expected a reversal to some of the optimism in markets at the end of last week. On Monday though, as NAB’s Taylor Nugent discusses, US equities continued to rise, with the Wall Street Journal reporting again that a turnaround in China’s policy could still be on the cards. Perhaps. Well, the Chinese trade numbers yesterday were a clear de
07/11/2022 • 13 minutes 15 seconds
China scotches Zero COVID speculation, again
Monday 7th November 2022NAB Markets Research Disclaimer Financial Services Guide | Information on our services - NABIt seems likely we’ll see a reversal to some of the positive sentiment on Friday that saw equities and commodity prices rise, driven by the renewed hope that China was moving towards an end to their zero COVID approach. The official word over the weekend was that that was not the case. NAB’s Skye Masters says there was also a positive response to non-farm payrolls in the US on Friday, with a rising unemployment rate suggesting the labour market was easing and there would be less pressure on the Fed, supporting the case for a 50pc rise at the next FOMC m
06/11/2022 • 16 minutes 40 seconds
A Tale of Two Britains
Friday 4th November 2022NAB Markets Research Disclaimer Financial Services Guide | Information on our services - NABIt could be the worst of times, or something even worse than that. The Bank of England painted two possible scenarios overnight, after raising rates by the expected 75 basis points. In scenario one, the bulk of their work is done and rates don’t move much higher. In scenario two, rates rise to 5.25% and the country faces a two-year recession. Talk about hedging your bets. NAB’s Ken Crompton says it shows the difficulties faced in the UK and Europe, in comparison with the US, where the Fed is fighting continued high consumption levels - evidenced by high
03/11/2022 • 15 minutes 3 seconds
No Pivot from the Fed, but markets bounce about
Thursday 3rd November 2022NAB Markets Research Disclaimer Financial Services Guide | Information on our services - NABWho’d have thought that a fourth 75 basis point hike by the Fed would see equity markets rally and bond yields down? As NAB’s Gavin Friend explains, the bounce didn’t last long, and it was driven by the term ‘cumulative tightening’, which markets took to mean the FOMC committee believed they could slow down while they assess the aggregate impact of the hikes so far. But in the press conference that followed Jerome Powell made it clear any slow down wouldn’t imply the terminal rate will be any lower, in fact it is likely to be higher than they’d been t
02/11/2022 • 17 minutes 9 seconds
Slow and steady wins the race
Wednesday 2nd November 2022NAB Markets Research Disclaimer Financial Services Guide | Information on our services - NABThe RBA has taken a slow and steady approach to interest rate hikes, so we can expect many more to come. Sally Auld says Governor Lowe said last night that the risks are more two-sided than they were a few months ago, and the bank needs to factor in the risk of the lag. It’s a very different approach being taken by the Fed, with a strong expectation that they will announce a 75bp hike tomorrow morning, reinforced by data showing a rise in job openings in the US. The optimism in markets yesterday afternoon that perhaps China was heading out of its zero COVID approach
01/11/2022 • 15 minutes 37 seconds
The Bank That Stops Inflation, eventually
Tuesday 1st November 2022NAB Markets Research Disclaimer Financial Services Guide | Information on our services - NABToday is the day of the race that stops the nation, but before the champagne flows there’s an RBA meeting to get through. NAB’s Tapas Strickland says the odds are on a 25bp hike today, but the board will be considering last week’s inflation surprise and yesterday’s retail numbers. So there’s an outside chance they will go higher. The FOMC meets later this week, and tonight’s JOLTs job openings numbers will be given some consideration. It’s a while till the next ECB meeting, but an inflation shock justifies last week’s 75 basis point hike and could just
31/10/2022 • 17 minutes 58 seconds
Will markets be spooked by scary central banks?
Monday 31st October 2022NAB Markets Research Disclaimer Financial Services Guide | Information on our services - NAB US equity markets rose sharply on Friday, even though there’s little evidence that inflation is easing or that the Fed will slow down their pace of hikes, despite all the pivot-talk of the last week. This morning NAB’s Rodrigo Catril is asked whether they are too optimistic, given the data and geopolitics we are experiencing right now. Could the fear of persistent inflation but the frighteners on them this Halloween? The US employment cost index might have moved down slightly, but the rate of wage growth is still way higher tha
30/10/2022 • 18 minutes
ECB slowing to a crawl now? More recession and pivot talk.
Friday 28th October 2022NAB Markets Research Disclaimer Financial Services Guide | Information on our services - NABThe ECB raised rates by 75 basis points as expected, but NAB’s Rodrigo Catril says a widespread expectation that central banks will ‘pivot’, and switch away from a path of higher rate rises. We don’ have long to wait to find out with the BoE, RBA and Fed all meeting next week. But is all this pivot talk misplaced? If it’s because of softening data, the Fed has made it clear that inflation will be tackled at whatever cost. For that reason, the employment cost index will be a key number to look out for from the US today. It’s a different story for the ECB
27/10/2022 • 17 minutes 18 seconds
Cries of ‘Pivot!’ as BoC slows hikes
Thursday 27th October 2022NAB Markets Research Disclaimer Financial Services Guide | Information on our services - NABThe Bank of Canada lifted rates by 50 basis points this morning, against expectations of a 75 bp hike. David de Garis says there were cries of ‘Pivot’ amongst the traders at NAB in London, but how far will it stretch. Does it follow that the Fed will follow in Canada’s footsteps? It’s unlikely the ECB will, when they meet later today. Or the RBA when they meet next week, given the stronger than anticipated inflation numbers yesterday. And a sign that the confidence crisis in the UK is over, the new PM announced a delay to the issuance of their new bud
26/10/2022 • 16 minutes 54 seconds
Why do so many expect the Fed to slow down?
Wednesday 26th October 2022NAB Markets Research Disclaimer Financial Services Guide | Information on our services - NABEquity markets and bonds have both rallied overnight, pushing yields lower again. NAB’s Skye Masters says investors are still hoping that the Fed will slow down the path of rate hikes, although there’s no data top suggest why they should and some commentators suggesting that rates might go up above 5 percent early next year. Italy’s new PM is opposed to hikes and an end to QE, warning of the impacts it’ll have on high debt economies, like Italy, for example. That’s unlikely to stop the ECB lifting rates by 75 basis points, which is what the Bank of C
25/10/2022 • 16 minutes 53 seconds
US rally, China’s slump, UK’s new PM
Tuesday 25th October 2022NAB Markets Research Disclaimer Financial Services Guide | Information on our services - NABIt's been a very mixed session depending on vaired geographic circumstances, says NAB’s Taylor Nugent. US equities continue to rally on anticipation of positive earnings results and the hope that the Fed will slow down its pace of hikes. Europe has seen modest gains as gas prices fall, offsetting a slightly worse than expected set of PMIs. The UK has seen gilts back in fashion as Rishi Sunak is announced as the new Prime Minister, generally seen as a relatively safe pair of hands. But China has seen the offshore Yuan fall sharply and equities also taki
24/10/2022 • 18 minutes 13 seconds
Fed might ease off, Boris gone
Monday 24th October 2022NAB Markets Research Disclaimer Financial Services Guide | Information on our services - NABThe US finished the week with equities rising and the dollar falling, with the Fed’s Mary Daly hinting that the path of hikes might slow for fear of an ‘unforced downturn’. NAB’s Ray Attrill notes that the Wall Street Journal’s Nick Timiraos suggesting the Fed might well be signalling a stepping down of rate increases, and that Timiraos rarely gets it wrong. It’s fun and game is the UK today as they fast track the selection process for the next Prime Minister, although since we recorded the podcast it seems an almost certainty that Rishi Sunak will be t
23/10/2022 • 16 minutes 36 seconds
The battle for Britain
Friday 21st October 2022NAB Markets Research Disclaimer Financial Services Guide | Information on our services - NABThe UK is on the lookout for another Prime Minister after Liz Truss announced her resignation overnight. Her replacement will be found by Friday next week, at the latest, but NAB’s Gavin Friend says there could be a new PM in place as soon as Monday. There wasn’t a massive market reaction, with the good news offset by the uncertainty of who will replace her. Boris perhaps? Yes, really. Meanwhile Aussie jobs numbers show the labour market remains tight, as did US weekly jobless claims. In short, another day with no signs of inflation easing.<hr
20/10/2022 • 16 minutes 7 seconds
Full reversal, for today
Thursday 20th October 2022NAB Markets Research Disclaimer Financial Services Guide | Information on our services - NABIt’s a very mixed day, but generally the reverse of yesterday. The US dollar has gained strength, bond yields have pushed higher and equities have fallen, despite some strong corporate earnings. NAB’s Taylor Nugent says we are back to worrying about inflation and central bank’s pursuing elevated interest rate paths. US 10 year yields reached a 14 year high overnight, as the Fed’s Neel Kashkari declared he had not seen any signs yet that inflation had peaked. Higher than expected inflation numbers in the UK and Canada have added to the mood, although g
19/10/2022 • 18 minutes 3 seconds
A Bear Rally Amid Hopes (again) of an Inflation Peak
Wednesday 19th October 2022NAB Markets Research Disclaimer Financial Services Guide | Information on our services - NABEquity markets have managed to climb again in the US, supported by earnings results, although NAB’s Ray Attrill describes it as a bear rally. There is still plenty of uncertainty around, evidenced by moves in bonds, in all directions. The BoE drove some of the movement when they announced they would resume bond purchases next month, on schedule, despite the diversion last week. New Zealand’s inflation numbers yesterday surprised on the upside, which begs the question, will we see the same with CPI for the UK and Canada today? <p st
18/10/2022 • 19 minutes 2 seconds
Brits Big U Turn, America Buys the Dip
Tuesday 18th October 2022NAB Markets Research Disclaimer Financial Services Guide | Information on our services - NABThe UK government decided it couldn’t wait till the end of the month to reverse almost all of their unfunded tax cuts, so they did it yesterday, much to everyone’s surprise. Markets have taken it well, with big falls in bond yields and a rise in Sterling, but as JBWere’s Sally Auld points out, there is still a big budget gap to bridge. The impact has helped buoy US equity markets though – perhaps looking for a buy-the-dip excuse. Today look out for NZ CPI and the minutes of the last RBA meeting, when they surprised with a less than expected 25bp rate h
17/10/2022 • 17 minutes 33 seconds
Where does it end?
Monday 17th October 2022NAB Markets Research DisclaimerFinancial Services Guide | Information on our services - NABUS Treasury yields rose higher still on Friday as markets absorbed Thursday’s inflation print and the expectation of faster hikes and a higher terminal rate from the Fed. Despite the hikes so far, there’s few signs of a slowdown, with NAB’s Rodrigo Catril pointing to Friday’s retail numbers which showed yet more resilience in spending from US consumers. We look at how this is all playing into the weakness of the Australian dollar. And then there’s the UK! Will they have a change of Prime Minister, will a complete reversal in policies be enough to stop the BoE
16/10/2022 • 19 minutes 24 seconds
Massive swings as US inflation stays high and UK ready for U-turn
Friday 14th October 2022NAB Markets Research Disclaimer Financial Services Guide | Information on our services - NABIt’s been a stormy night, with violent swings in bond yields and US equities. As NAB’s Skye Masters explains, shares plummeting as the higher than expected CPI read but then staged a massive rebound later I the session, fishing markedly higher towards the close. Bond markets responded more predictably, pricing in a more aggressive path of rate hikes from the Fed – maybe 150bp before Christmas. Meanwhile, massive swings on UK bonds with reports that the Truss government might be ready to stage another u-turn on their unfunded tax cuts, although the Chanc
13/10/2022 • 16 minutes 33 seconds
Less jobs before Fed stops
Thursday 13th October 2022NAB Markets Research DisclaimerFinancial Services Guide | Information on our services - NABThe BoE has been buying up more bonds to protect pension funds from the volatility of an economy still struggling with the budget presented by the Truss government. But when Andrew Bailey says the help stops on Friday does he really mean it, or will they be back buying bonds next week? Meanwhile the latest GDP numbers show the UK could well be in a recession, or at least the economy is looking very off colour. Meanwhile, the latest FOMC minutes show the US central bank is determined to continue to tackle inflation, and rate rises won’t stop until the labour
12/10/2022 • 17 minutes 46 seconds
Don't Panic Mr Bailey
Tuesday 12th October 2022NAB Markets Research DisclaimerFinancial Services Guide | Information on our services - NABThe Bank of England has been buying up more government bonds as it fights uncertainty in UK markets. NAB’s Ken Crompton says it’s no surprise that they have had to target 30 year inflation-linked bonds, as they constitute a large proportion of the stock held by the pension funds the bank is trying to protect. But, with devastating opinion polls and a rebuff of their budget plans by the IMF, expect more UK uncertainty in the weeks ahead. Meanwhile, in Australia the gap between consumer and business expectations has widened further, we look at why that is.&nbs
11/10/2022 • 17 minutes 37 seconds
Gloomy and more uncertain
Tuesday 11th October 2022NAB Markets Research DisclaimerFinancial Services Guide | Information on our services - NABThe latest title from to the IMF’s World Economic Outlook is ‘Gloomy and More Uncertain’. That certainly reflects the mood this morning, with risk driven by an escalating war in Ukraine, question marks over whether the UK Chancellor’s budget will pass muster with the markets, and the China slowdown, now added to by President Biden cracking down on the export of advanced semiconductors. NAB’s Rodrigo Catril says the timing of the US Presidents restriction is impeccable, just ahead of the Party Congress and the expected announcement of President Xi winning ano
10/10/2022 • 17 minutes 19 seconds
Tight labour, hawkish banks, angry Putin
Monday 10th October 2022NAB Markets Research DisclaimerFinancial Services Guide | Information on our services - NABThere was a strong market reaction to non-farm payrolls on Friday, which suggested the US labour market remains tight, with the unemployment rate falling. NAB’s Tapas Strickland says it was another of those ‘good news is bad news’ moments, likely to keep the Fed on its hawkish path for some time yet. That could be reinforced if CPI data this week remains strong. The question is, how will any central bank know when it has overshot its target? There could be some caution today as the world waits for Putin’s response to the Crime bridge explosion.
09/10/2022 • 18 minutes 32 seconds
Less pivot hope, from Paris
Friday 7th October 2022NAB Markets Research DisclaimerFinancial Services Guide | Information on our services - NABMarkets are still nervous. This morning NAB’s Gavin Friend says hopes of a pivot from the Fed have more or less disappeared, following on from the softer manufacturing numbers earlier in the week. The Fed’s Neal Kashkari said we are quite a way away from a pause in their path of rate hikes. A lot rests on today’s non-farm payrolls, with the markets ready to pounce on anything that could suggest a slow down from the Fed. Today’s episode, out a little earlier than normal, comes from the Australian Embassy in Paris, where NAB has been talking to investors about o
06/10/2022 • 14 minutes
Pivot talk killed by resilient services ISM read
Thursday 6th October 2022NAB Markets Research DisclaimerFinancial Services Guide | Information on our services - NABYesterday’s vain hope of a pivot by the Fed, to slow down rate rises after the weaker job openings numbers, were destroyed today by a stronger than expected non-manufacturing ISM read. Not only was the main number higher than anticipated, at 56.7, new orders were strong too. It was another of those good news is bad news moments, because its unlikely the Fed will consider any slow down in their path of rate hikes when the economy is showing strong growth against a tight labour market. On that, the ADP employment numbers reported wages growing at 7.6 percent i
05/10/2022 • 15 minutes 36 seconds
Markets jump on JOLTs and RBA surprise
Wednesday 5th October 2022NAB Markets Research DisclaimerFinancial Services Guide | Information on our services - NABThere’s plenty of talk of a Fed pivot according to JBWere’s Sally Auld, but is it an overreaction? The drivers have been the smaller than expected rise by the RBA yesterday and one million less jobs being advertised in the US. Bond yields have fallen and the equity markets are lapping it up. So, today, will the RBNZ follow in the RBA’s footsteps? Markets are expecting a 50 basis point rise in New Zealand, but that’s what they said about Australia. Hosted on Acast. See <a style='color:grey;' target=
04/10/2022 • 16 minutes 18 seconds
Markets buoyed by bad news and caving in
Tuesday 4th October 2022NAB Markets Research DisclaimerFinancial Services Guide | Information on our services - NABThere’s been a swift change of direction in markets, with bond yields falling and big rises in equities in the US and Europe. NAB’s Tapas Strickland says there are several reasons for this reversal in fortune. Part of it is a partial u-turn by the UK chancellor over unfunded tax cuts, suggesting the new government is not as cavalier as some had feared. Second, the US ISM numbers came in weaker than expected, showing a fall in demand, rising inventories and a drop in manufacturing prices. Locally, the RBA is expected to lift rates by 50bp today, and tonight th
03/10/2022 • 17 minutes 49 seconds
No slowdown yet: Euro inflation and US core PCE
Monday 3rd October 2022NAB Markets Research DisclaimerFinancial Services Guide | Information on our services - NABThe lasting effect from the UK’s mini-budget kerfuffle has not been the weakness in the pound – that’s bounced back for now – but the rise in bond yields. They are, of course, rising everywhere as central banks find it increasingly hard to fight inflation. The pound might feel some pressure today, though, as S&P put the UK’s credit rating on a “negative outlook”. NAB’s Taylor Nugent says it doesn’t mean a downgrade is going to happen, but it adds to the uncertainty the UK is facing right now. Meanwhile, inflation remains strong, with the Euro area reportin
02/10/2022 • 16 minutes 57 seconds
UK calmer, US stocks fall, yields rising on hawkish Fed & ECB
Friday 30th September 2022NAB Markets Research Disclaimer Financial Services Guide | Information on our services - NABThings are calmer in the UK because the Prime Minister has agreed to get the numbers to support last week’s budget. Whilst that’s helped the pound a little, yields continue to rise. NAB’s Tapas Strickland says the volatility is far from over in the UK. Elsewhere there’s rising concern over inflation, which is showing little signs of easing, with central banks (the Fed and ECB in particular) continuing their hawkish tilt. That’s hit US stocks hard today. Also on today’s podcast a look at yesterday’s monthly CPI umbers for Australia and a look ahead to
29/09/2022 • 16 minutes 42 seconds
UK ticked off by IMF, whilst BoE goes back to QE
Thursday 29th September 2022NAB Markets Research DisclaimerFinancial Services Guide | Information on our services - NABIt’s been quite a session in the UK, with the IMF reprimanding the government over it’s budget, and the Bank of England suspending its quantitative tightening, instead switching to buying longer end bonds in a move to protect pension funds. What’s all this doing to the UK’s credibility? NAB’s David de Garis talks through the events from London. In the US equities have bounced back, even though central banks show no sign of stepping back on their hawkish stance. The war in Ukraine is showing signs of escalation, with Russia now accused of sabotaging gas pi
28/09/2022 • 14 minutes 59 seconds
US dollar and bond yields continue to rise, till when?
Wednesday 28th September 2022NAB Markets Research DisclaimerFinancial Services Guide | Information on our services - NABA rising US dollar, yields pushing higher, equities being sold off, central bankers talking up rates – that’s been business as usual lately. NAB’s Skye Masters says resilience in economic data, particularly for the US, isn’t making the job any easier for central banks, who expect rates to be higher for longer than markets envisage. In the UK the terminal rate for the Bank of England has risen markedly, of course, with Huw Pill, the chief economist, warning that the response to the government’s budget will require a significant monetary policy response, b
27/09/2022 • 16 minutes 11 seconds
Tuesday 27th September 2022NAB Markets Research DisclaimerFinancial Services Guide | Information on our services - NABThe pound fell to an all-time low overnight before picking up a little, but still well down on the day as markets react badly to the new UK Chancellor’s mini-budget last week. NAB’s Taylor Nugent talks through the response, which is being driven largely by uncertainty. Gilt yields have pushed up markedly and the unease has spread to other markets, with bond yields also rising sharply in the US. There has been some expectation that the Bank of England will call an emergency meeting, whilst the Chancellor has said he will provide a fully costed proposal in t
26/09/2022 • 18 minutes 36 seconds
The pound hammered, will it last?
Monday 26th September 2022NAB Markets Research DisclaimerFinancial Services Guide | Information on our services - NABThe UK budget that wasn’t a real budget, turned out to be more far reaching than most budgets and certainly had far more market impact. On today’s podcast Phil asks NAB’s Ray Attrill whether the sharp fall in the pound will be retraced this week, particularly as the UK’s government debt is still far less than many other European nations. Italy’s election results will be released shortly, but the lurch to the right has already been well signalled. On the data front, PMIs on Friday showed further weakness in Europe and the UK, with some gains in the US, but t
25/09/2022 • 17 minutes 13 seconds
Central bank overload
22/09/2022 • 17 minutes 2 seconds
0.75% hike by the Fed, no bluff
21/09/2022 • 18 minutes 22 seconds
Fed to push higher, Putin pushing for referendums
20/09/2022 • 16 minutes 40 seconds
Fears the Fed will keep at it for a while yet
19/09/2022 • 15 minutes 8 seconds
Prepare for a volatile week of Banks and Holidays
18/09/2022 • 16 minutes 23 seconds
Heading higher and taking longer
15/09/2022 • 18 minutes 51 seconds
The day after. No big bounce.
14/09/2022 • 16 minutes 45 seconds
Peak inflation, not yet
13/09/2022 • 16 minutes 24 seconds
The risk of rising risk sentiment
12/09/2022 • 15 minutes 46 seconds
Fed still pushing, BoE pushes back, EU struggling for answers
11/09/2022 • 17 minutes 2 seconds
Yields rising as ECB lifts rates and Fed prepares for a big one
08/09/2022 • 15 minutes 8 seconds
Bigger hopes of smaller hikes to come
07/09/2022 • 17 minutes 3 seconds
More work for the Fed, UK’s massive Truss Fund
06/09/2022 • 17 minutes 40 seconds
UK and Europe move from bad to worse, RBA today
05/09/2022 • 16 minutes 20 seconds
Putin ends Goldilocks moment
04/09/2022 • 16 minutes 30 seconds
Will strong jobs numbers add to the Fed’s battle tonight?
01/09/2022 • 16 minutes 58 seconds
Euro inflation high, pound heading back to the pleasure dome
31/08/2022 • 14 minutes 31 seconds
More good news, that’s actually bad news
30/08/2022 • 17 minutes 12 seconds
Aussie yields push higher after July’s shopping bonanza
29/08/2022 • 16 minutes 46 seconds
Fickle equity investors respond to unsurprising Powell comments
28/08/2022 • 16 minutes 35 seconds
Peering into Jackson hole
25/08/2022 • 15 minutes 12 seconds
Dire Straits for UK and Europe
24/08/2022 • 16 minutes 32 seconds
Business activity falls, but not enough to slow the Fed
23/08/2022 • 15 minutes 7 seconds
Markets respond as European gas prices push ever higher
22/08/2022 • 14 minutes 46 seconds
Shopping to the very end
21/08/2022 • 16 minutes 38 seconds
Fed still trying to show they won’t give in
18/08/2022 • 16 minutes 37 seconds
UK’s sticker shock inflation drives caution
17/08/2022 • 16 minutes 8 seconds
Retail, wages and RBNZ
16/08/2022 • 17 minutes 15 seconds
Slow boat from China
15/08/2022 • 15 minutes 1 second
A positive outlook, apart from the downturn
14/08/2022 • 13 minutes 59 seconds
Not convinced by the Fed
11/08/2022 • 15 minutes 2 seconds
False hope on easing inflation?
10/08/2022 • 16 minutes 12 seconds
09/08/2022 • 16 minutes 35 seconds
Markets in limbo
08/08/2022 • 11 minutes 22 seconds
US jobs market too hot for the Fed?
07/08/2022 • 15 minutes 3 seconds
Uncertainty reigns, except in Britain. It’s just grim there.
Friday 5th August 2022Markets continue to be pulled in two directions. Is inflation peaking with the hope of a soft landing? Or is there more to come, forcing central banks to lift rates high enough to spark a recession. At least the uK seems to have a clearer picture, but its not a good one. As NAB’s Gavin Friend discusses today, the Bank of England has lifted rates by 50 basis points, lifted their inflation forecasts and warned of five consecutive quarters of economic contraction. So, why is it so much worse in the UK than Europe? And could a change in Prime Minister change the outlook? He also talks to Phil about yesterday’s Australian trade data and looks ahead to tonight’s non-farm payrolls in the US. Hosted on Acast. See acast.com/privacy for more information.
04/08/2022 • 16 minutes 48 seconds
The quick path to credible disinflation and other stories
Thursday 4th August 2022Nancy Pelosi has moved on from Taiwan and taken the cautious sentiment with her. Instead, very positive ISM services numbers in the US, and James Bullard talking about how the Fed will deliver ‘credible disinflation’, have seen the US dollar strengthen, helped shares bounce back and driven front end bond yields down. Today Phil talks to NAB’s Ray Attrill about what Bullard had to say, what to expect from the Bank of England today and whether Australia’s trade balance will actually increase, rather than the consensus view of a slight fall. Hosted on Acast. See acast.com/privacy for more information.
03/08/2022 • 15 minutes 51 seconds
Pelosi in Taiwan, Fed nowhere near almost done
Wednesday 3rd August 2022There has been some market caution this morning as Nancy Pelosi arrives in Taiwan, much to the disgust of China. Her rhetoric has been confrontational too, so what is the purpose of this visit? Fed speakers have been keen to shift US market sentiment away from the notion that there will be an easing in the path of rate hikes, with Mary Daly saying they are “nowhere near almost done”. NAB’s Tapas Strickland says there’s been a sharp rise in 2 year yields since, fully erasing the fall seen after the last FOMC meeting. The RBA raised rates as expected but is being cagey about where to next. On today’s podcast we look at the likely path to the end of the year, but is the market overly optimistic about how quickly rates will come back down? Hosted on Acast. See acast.com/privacy for more information.
02/08/2022 • 16 minutes 52 seconds
Recession signs, RBA to hike, grains from Odessa
Tuesday 2nd August 2022There were further signs of a looming recession, with the US manufacturing ISM weakening, the Caixin Manufacturing PMI also lower and retail sales in Germany falling the most in 50 years. Oil is also falling, and the 2-10 yield spread in the US is close to being the most inverted it’s been since the year 2000. You’d think although these recession signs at a time when central banks are still pursuing aggressive hikes would be enough to upset the markets, but NAB’s Rodrigo Catril says they clearly haven’t got the message yet, with equities showing only minor falls today. The only positive news of the day was that the first shipment of grain has left from Odessa, but it’s anyone’s guess how long that will last. The RBA meets today, a 50-basis point rise is expected, and an increase in the bank’s inflation forecast this week. Hosted on Acast. See <a style='color:grey;' target='_blank' rel='noopener noreferrer' href='
01/08/2022 • 17 minutes 7 seconds
No inflation slowdown, just wishful thinking
Monday 1st August 2022For those hoping that inflation was peaking (anywhere), then Friday didn’t bring good news. PCE numbers in the US are rising, Europe’s CPI is climbing higher, whilst manufacturing from China has slowed. Clearly, we’re not out of the woods yet, with former US treasury secretary Larry Summers saying on Friday that the Fed hasn’t reached a neutral rate yet, and the fact that Jerome Powell has said they have is just “wishful thinking”. So, what does this all mean for the RBA tomorrow. NAB’s Taylor Nugent says the expectation is there will be a 50 basis point rate hike, but Philip Lowe has spoken about a narrow path “clouded in uncertainty” – is there an outside chance he will see the need to move even faster as global inflation rates show few signs of easing? Hosted on Acast. See acast.com/privacy for more information
31/07/2022 • 18 minutes 36 seconds
When is a recession not really a recession?
Friday 29th July 2022US GDP fell by 0.9 percent in Q2. On top of the 1.6 percent fall in Q1 that meets the technical definition of a recession. But Jerome Powell and Janet Yellen are keen to point out the downturn is not sufficiently broad based to be called a recession. Nonetheless it does signify a further weakening in the economy, which investors seem to be taking as a sign that the Fed won’t need to be as aggressive to counter inflation. NAB’s Gavin Friend says that although the market may be trying to lead the Fed in that direction, that’s not how Jerome Powell sees it and we can expect to see further significant hikes. Perhaps the same could be say for the RBA, with Australian retail sales continuing to rise and Treasurer Chalmers yesterday predicting inflation will peak at 7,75 percent, well above the RBA’s 7 percent forecast. Hosted on Acast. See <a style='color:grey;' target='_blank' rel='noopener noreferrer' href='https://aca
28/07/2022 • 15 minutes 29 seconds
Fed hikes 75bp, no forward guidance
Thursday 28th July 2022The FOMC has met, they’ve pushed rates up 75 basis points and, whilst Jerome Powell said there would be no forward guidance, he has hinted at another big rise next time. Of course, it all depends on the data. Phil Dobbie talks to NAB’s David de Garis about the take-outs from the press conference, which injected some animal spirits into the share market. They also look at yesterday’s Australian inflation numbers, and whether they have cemented in a 50-basis point rate rise by the RBA, or could it be more? Plus the Meta earnings release, which brought mixed news after the US market close. Hosted on Acast. See acast.com/privacy for more information.
27/07/2022 • 17 minutes 20 seconds
Shares down as consumers focus on the essentials
Wednesday 27th July 2022There gave been sizeable falls in US equities, mainly stemming from a cut to Walmart’s profit estimates. NAB’s Tapas Strickland explains how the rising price of food is leaving less money for people to spend on discretionary items, with more price increases to come. Meanwhile, Europe is hoping to cut gas consumption as Russia halves the supply of gas down the Nordstream pipeline. The EU has agreed a voluntary arrangement, but will be enough to build reserves for winter? Australia’s inflation numbers are out today – what will they be, and could they force the RBA to be more aggressive next week? The IMF has downgraded its global growth forecasts, noting an increasingly gloomy and uncertain outlook. Least but not least, the FOMC announces its rate decision just before tomorrow’s podcast. Tune in then for the full rundown, as it happens. Hosted on Acast. See <a style='color:grey;' target='_blank' rel='noopener nore
26/07/2022 • 14 minutes 53 seconds
Then there was one (turbine)
Tuesday 26th July 2022From Wednesday one of two operating turbines on the Nordstream pipeline will be switched off, effectively halving the existing supply, taking gas provision to Europe down to 20 percent of full capacity. There’s no clear evidence that Europe has a coordinated plan to deal with reduced supplies, as EU member nations argue over the equality of calls for reduced consumption. NAB’s Ray Attrill says the threat of the full blown weaponization of gas supplies later in the year is still very much a live issue. Meanwhile, markets are treading water ahead of the FOMC meeting middle of the week, the US GDP read after that and Aussie inflation numbers tomorrow. There’s also a slew of major earnings results over the next few days. Hosted on Acast. See acast.com/privacy for more information.
25/07/2022 • 15 minutes 37 seconds
Softer data, harder RBA
Monday 25th July 2022PMI numbers were much weaker than expected on Friday, particularly for US services, which fell quickly into a contractionary read of 47.1. The composite read for Europe also fell below 50. Will this mean central banks ease off the rate-hike pedal a little? The opposite is expected in Australia. Rodrigo Catril explains how NAB believes the lower-than-expected unemployment rate last week cannot be ignored, and it’s likely the RBA will move faster over the next couple of meetings. Vladimir Putin continues to hold a strong grip on energy and food supplies, offering a re-opened gas pipeline with constrained supply, and reopened grain delivery routes, offset by attacks on their principal port of departure. It’s a busy week ahead, including the Fed meeting, and more inflation numbers. Hosted on Acast. See acast.com/privacy</a
24/07/2022 • 17 minutes 20 seconds
ECB makes it to zero
Friday 22nd July 2022As we predicted the ECB lifted interest rates by 50 basis points yesterday, up to zero percent. NAB’s Ken Crompton says this was more than markets had expected and explains there was a short-lived reaction on the bond markets. There was also disappointment in the central bank’s anti-fragmentation tool, which now has a name and a new acronym! Right now it’s light on detail and will countries like Italy be able to meet the criteria being set for its use, even though, with rising spreads with German bunds, they are the ones who really need it. In the US weaker jobs claims gave job that the labour market might be easing. Coupled with weaker than expected manufacturing data, there’s always the hope that the Fed won’t need to be so aggressive. PMI data today will give a further indication of how services and manufacturing are travelling, in the US, UK and Europe. Hosted on Acast. See <a style='color:grey;' target='_blank
21/07/2022 • 17 minutes 57 seconds
Gas will trickle, Draghi will go, ECB will hike
Thursday 21st July 2022There’s some confidence in the markets this morning, despite what seems to be a compendium of bad news for Europe. NAB’s Gavin Friend says gas prices have fallen because Vladimir Putin has indicated that they will meet the reopening deadline for the Nordstream pipeline, but it’ll be at only 20 percent of its capacity. As discussed on today’s podcast, that might be enough to meet short term demand, but won’t allow Europe to build up stocks for winter. The ECB meets today and will outline plans for its anti-fragmentation tool. If markets aren’t impressed, it could bolster Italian bond yields, which have already pushed higher on growing uncertainty over Draghi’s tenure in the Italian parliament. We also look at what Philip Lowe said yesterday, ahead of August’s RBA meeting. Hosted on Acast. See acast.com/privacy for
20/07/2022 • 15 minutes 15 seconds
Markets set for a tougher ECB
Wednesday 20th July 2022Markets are preparing for a big rate rise by the ECB tomorrow. NAB’s Rodrigo Catril says they are hiking when the expectation is that the Nordstream pipeline won’t fully reopen for some time, if at all. “No energy means no growth”, he says, with the likelihood that Europe is heading for a major recession. Is the central bank prepared for that? Politically, can Europe cope with it all? Also today, we look at what the Bank of England’s Andrew Bailey had to say about UK rate expectations, ahead of inflation numbers later today. Plus, is the RBA preparing the market for a 75bps hike? And those flicking the off switch on Netflix - not as bad as expected. Hosted on Acast. See acast.com/privacy for more information.
19/07/2022 • 17 minutes 6 seconds
Oil rises as Saudi’s don’t budge, gas to Europe unlikely this week
Tuesday 19th July 2022The resumption in gas supplies to Europe could well be delayed, but perhaps Russia has a legitimate reason. A bigger move this morning has been the rise in the price of oil which NAB’s Ray Attrill will in part be down to Saudi Arabia’s refusal to increase supplies. Equities have fallen slightly, in part because of reports that Apple are downgrading their hiring and growth plans. US housing continues to be under pressure, with more data today. We also hear from the RBA’s Michelle Bullock today, who might give away some indication of rate expectation, perhaps. Hosted on Acast. See acast.com/privacy for more information.
18/07/2022 • 15 minutes 22 seconds
A Good Friday but a crunch week for Europe
Monday 18th July 2022US equities rallied on Friday as data releases showed some resilience in the economy, but is it enough to stave off recession? Probably not, says NAB’s Tapas Strickland on today’s podcast, but it will be enough to put to bed any ideas of a 100 basis point rate rise by the Fed this month. Also today, China’s fall in GDP was worse than expected, with continuing lockdowns making the official forecast for the year completely out of reach. The focus this week will be on Europe: what if the Nordstream pipeline doesn’t reopen? And, with so much uncertainty, NAB is predicting the US dollar will remain stronger for longer, which is likely to keep the Aussie dollar below 70 US cents for some time to come. Hear more about that in today’s podcast too. Hosted on Acast. See acast.com/privacy for more information.
17/07/2022 • 16 minutes 51 seconds
Aussies Take Up Jobs as Draghi Tries to Quit
Friday 15th July 2022In a week of surprises (US CPI and labour market data, Canada’s interest rate rise, China’s lockdowns and the US$-Euro parity), yesterday saw a sharp fall in Australia’s unemployment rate. ‘It was our turn to surprise’, says NAB’s Taylor Nugent on this morning’s podcast. Unemployment has now fallen to a level below what the RBA was forecasting for next year, so does this mean we should expect a much larger hike at the start of next month? The big news this morning is the attempted resignation of Italian Prime Minister Mario Draghi, adding to the turmoil in Europe and adding to the US dollar strength. Next week is shaping up to be a turbulent week for the ECB, particularly if Vladimir Putin doesn’t turn on gas supplies as scheduled. Rising US PPI numbers added to the inflation story overnight. Today, US retail sales numbers are out, and the University of Michigan inflation expectations survey, which last month convinced the Fed to move rates higher.<p styl
14/07/2022 • 17 minutes 28 seconds
US Inflation rises and surprises, everything is in play
Thursday 14th July 2022US inflation has picked up more than expected, rising 9.1% in the year to June. The Fed’s Raphael Bostic said later that “everything was in play” when it came to a July rate rise. NAB’s David de Garis says, it doesn’t take a genius to figure out what he meant. The Bank of Canada (BoC) had just raised rates by 100 basis points, more than had been expected, so had that paved the way for the Fed? It certainly makes the RBNZ’s 50 basis point hike seem a little constrained. The UK GDP growth was, unusually, helped by trips to the doctor, rather than to restaurants. Locally, Australian labour market data will be studied closely. Can the jobs market tighten any more and add to the pressure for faster hikes from the RBA? Hosted on Acast. See acast.com/privacy for more information.
13/07/2022 • 17 minutes 9 seconds
Freaking out over inflation
Wednesday 13th July 2022There’s no let-up when it comes to the downward expectations around the health of the global economy. US bond yields inverted further, suggesting a heightening of recession expectations. Oil prices fell sharply lower, suggesting demand is expected to fall further. US small business owners who expect conditions to improve in the next six months fell to minus 54%, the lowest in half a century. The confidence in the German ZEW survey hit a 10-year low yesterday. The NAB business survey also showed business optimism falling sharply. And NAB’s Gavin Friend reckons the prospect of an energy crisis in Europe is the real danger that is not yet fully reflected in market pricing. What will turn all this around? Central banks think a race to higher rates will fix the problem, with the Bank of Canada and RBNZ trying to outdo each other today on who can rate the fastest. So, imagine the reaction if US CPI numbers come out higher than expected today.<p style='color:
12/07/2022 • 16 minutes 56 seconds
China flares up, Putin flexes more, US Dollar pushes higher
Tuesday 12th July 2022There’s a more cautious tone in the markets today, with US equities falling, bond prices rising, and the US dollar continuing on the up and up. Sentiment hasn’t been helped today by more lockdowns in China as COVID cases flare up. Ironically, Yuan loans have increased a fair bit. NAB’s Tapas Strickland says this suggests, perhaps, that the economy will pick up once COVID cases have settled down. Meanwhile the Euro is very close to parity with the rising US dollar, as concerns grow about continuity of energy supplies. Already parts of Germany are starting to ration energy use. Hosted on Acast. See acast.com/privacy for more information.
11/07/2022 • 16 minutes 9 seconds
Healthy jobs data bad news for the economy
Monday 11th July 2022It is a bit weird that positive US jobs data would be seen as heightening the expectations of a recession, but that seems to be the case. As NAB’s Ray Attrill explains on today’s podcast, the strength in the non-farm payrolls numbers of Friday did nothing to ease expectations that the Fed will continue with a rapid pace of rate hikes, and that could easily lead to a recession in the US. In Europe ECB speakers, like Robert Holtzman, are pushing for larger rate hikes even though rising energy prices (and shortages) are a very real prospect, with the next meeting this week. Meanwhile, recession prospects and a strengthening US dollar are playing havoc in emerging markets, as evidenced by the situation in Sri Lanka right now. Hosted on Acast. See acast.com/privacy for more information.
10/07/2022 • 15 minutes 45 seconds
A glimmer of hope, except for Boris
Friday 8th July 2022There have been slightly less recession concerns in the US overnight, with equities and commodity prices pushing higher and 10 year Treasury yields pushing back over 3%. Jobs have been front and centre, with weekly jobless claims not moving far, and non-farm payrolls adding more data to the picture later tonight. It’s been a torrid day in UK politics, with Boris Johnson resigning but not leaving Downing Street until a replacement is found. NAB’s Gavin Friend talks through the impact it’ll have on the UK economy. Whilst China is contemplating a massive spending spree for local governments to build infrastructure and get the economy back on track. Hosted on Acast. See acast.com/privacy for more information.
07/07/2022 • 17 minutes 47 seconds
Significant risk, still?
Thursday 7th July 2022The FOMC minutes are out, pointing to significant risk if inflation isn’t nipped in the bud. Markets are taking this as a sign that the Fed will lift rates more quickly, starting with a 50-75 basis point hike at the next meeting. This has added to concerns about the Fed inducing a recession, yet equity markets continue to climb. Phil asks NAB’s Ray Attrill whether the minutes are a little out of date, given the ISM read shows a fall in employment. We’ll get a clear indication of the jobless rate with initial claims for the US tonight. And Australia’s trade balance is the major release locally. Hosted on Acast. See acast.com/privacy for more information.
06/07/2022 • 14 minutes 44 seconds
Oil Dives, Bonds Rally as Recession Fears grow
Wednesday 6th July 2022The Euro is getting closer to parity with the US dollar. In today’s podcast NAB’s Skye Masters points out that the Markets team had forecast parity by the end of the year, but it looks like it wil happen much sooner than that. The big moves overnight, including a sizable fall in oil and copper, show recession fears are front and centre, even though there’s been very little data, and what there has been has not been particularly bad news. Skye says days like today, where there are some contradictory shifts, demonstrate the importance of looking at the trends and focusing on the bigger picture. Tomorrow could easily see a reversal of the moves we’ve seen today. The US share market had a wide trading range today, showing just how much uncertainty there is in the direction of travel right now. Hosted on Acast. See acast.
05/07/2022 • 15 minutes 1 second
Australia, faring better than most, but big hike still expected
Tuesday 5th July 2022The RBA meets today and the NAB expectation is that they will lift interest rates by 50 basis points. Phil asks NAB’s Tapas Strickland whether, by seeing inflation rising slower than many other parts f the world, whether we’ll see a lower peak and hence, less work needed by the RBA. There seem to be lots of hope lately that inflation might be showing signs of peaking, but the war rages on and oil and food supplies are still heavily constrained. The most telling reality check is that Germany trade has fallen heavily into deficit, for the first time since 1991 (and even then, only relatively briefly). It could be worse still if Russia restrains supply even further. Hosted on Acast. See acast.com/privacy for more information.
04/07/2022 • 16 minutes 28 seconds
Independence Day: Recession Resurgence
Monday 4th July 2022Recessions fears continue to rise, pushing bond yields lower. As NAB’s Rodrigo Catril explains, the ISM manufacturing report in the US on Friday added to the fears, showing a contraction in new orders. It’s no longer an issue of supply constraints, demand is also softening. Yet inflation continues to rise. In Europe it grew from 8.1% year on year in May, to 8.6% in June. A big fall in copper prices also suggests an expected fall in demand. All this uncertainty is knocking the Aussie dollar down more than most currencies. This environment provides the ammunition for the RBA to make a large hike (50 basis points) tomorrow. Later in the week we’ll see if the tight labour market in the US is easing any, with the release of the monthly non-farm payrolls data. Prepare for a bumpy week again. Hosted on Acast. See acast.com/pr
03/07/2022 • 15 minutes 21 seconds
And back to recession fears
Friday 1st July 2022Yields are lower in the US and Europe as recession fears grow, prompted by weaker than expected personal spending in the US, with a very strong chance of a negative Q2 GDP, which would mean the US economy was in recession. Whilst you might hope less consumption would mean falling inflation, NAB’s Tapas Strickland days there’s little sign of it yet. It wasn’t just the US receiving bad news. There was a flurry of negative data for Europe, even before the EDB lifts rates, and a particularly bad activity outlook report from New Zealand. So, if the US, Europe, UK and New Zealand all go into recession, does that mean Australia will follow? Hosted on Acast. See acast.com/privacy for more information.
30/06/2022 • 16 minutes 31 seconds
Understanding how little we understand
Thursday 30th June 2022Markets are confused as to where the global economy is heading. If investors were looking to the ECB Forum in Sintra for clarification, they will have been disappointed, with Jerome Powell confessing that recent experience has shown ‘how little we understand inflation’. NAB’s Gavin Friend says it doesn’t inspire you with confidence, when central banks are feeling their way. Meanwhile, all we can do is look for signs of softening economies, in the hope that falling demand will match up with lower supplies. On that basis a downward revision in US GDP could be seen as good news and Australian retail sales holding up the opposite side of the coin. There is a plethora of data today to add to the confusion, including the core PCE deflator, that the Fed has traditionally turned to as its measure of inflation. Hosted on Acast. See <a style='color:grey;' target='_blank' rel='noopener noreferrer' href='https://acast.com/pr
29/06/2022 • 14 minutes 47 seconds
Less US confidence, tough talking ECB
Wednesday 29th June 2022US equities switched direction overnight. NAB’s Taylor Nugent says it was a swift response to a weaker than expected consumer sentiment read in the US, with a particularly sharp fall in the expectations component. European yields are markedly higher today as Christine Lagarde spoke up the task at hand for the ECB, even though she continues to outline a hike of just 25 basis points in July. Today, Australian retail sales numbers are out, NATO continues to meet and the ECB forum in Sintra finally gets down to some meaty discussion. Hosted on Acast. See acast.com/privacy for more information.
28/06/2022 • 17 minutes 52 seconds
Heading for a choppy end to Q2
Tuesday 28th June 2022The volatility of the past few months means there is likely to be a greater need for rebalancing at the end of the quarter this time, says NAB’s Rodrigo Catril. Hence, we have seen a mixed picture overnight, with equities down, yields rising, the Aussie dollar suffering another fall and oil and iron ore rising in price, but each for differing reasons. Yet the overarching picture is one of uncertainty. Nobody is sure that central banks can combat inflation without instigating a recession, and nobody has a clear picture about how the Ukraine war will end. Once again, we try and map out a picture in the face of markets, geopolitics and data releases. Hosted on Acast. See acast.com/privacy for more information.
27/06/2022 • 17 minutes 3 seconds
Is bad news good news these days?
Monday 27th June 2022These are strange times. Market sentiment improved at the end of last week because of weaker consumer sentiment and a downward revision in consumer inflation expectations. The hope is this means that central banks will need to do less to curb inflation, which is reducing recession fears. But as NAB’s Ray Attrill says, that could all change tomorrow. Or today. The war in Ukraine is escalating and the G7 resolve to do more against Russia is increasing. Also today, what the RBA’s Philip Lowe said in Zurich last week, and the fate of the Aussie dollar? Hosted on Acast. See acast.com/privacy for more information.
26/06/2022 • 17 minutes 41 seconds
Unconditional commitment, come what may
Friday 24th June 2022There have been big movements in bond yields overnight. NAB’s Ken Crompton says there’s been a reaction to weak PMI data from Europe and the US. There were promising signs, though, particularly in Europe were rising inventory numbers suggest demand is softening and prices are weakening, which could lessen the need for aggressive hikes by the ECB. Nothing, it seems, will stop the Fed though, with Jerome Powell renewing his unconditional commitment to reducing inflation. Hosted on Acast. See acast.com/privacy for more information.
23/06/2022 • 14 minutes 47 seconds
Markets split as Powell admits recession is possible
Thursday 23rd June 2022You take whatever you want from a senate hearing, so there have been mixed reviews of Jerome Powell’s performance in front of the Senate Banking Committee. Some picked up on his claim that the US economy was in a strong position, whilst others focused on his warning that a recession was a ‘possibility’. Phil asks NAB’s Gavin Friend if that’s why we’re seeing sentiment split, from positive moves in US equities for most of the session, to a less positive outlook amongst bond markets and commodity traders, with the Aussie dollar bearing the brunt of it. They also discuss UK and Canadian CPI, and look ahead to the barrage of PMIs today. Hosted on Acast. See acast.com/privacy for more information.
22/06/2022 • 17 minutes 36 seconds
Brighter days ahead
Wednesday 22nd June 2022We’ve just had the longest night of the year in Australia but the markets are focused on the light at the end of the tunnel! There is a lot of positive sentiment today, with NAB’s Taylor Nugent point to strong growth in US and European shares across almost all sectors. So, does this mean there’s an acceptance, once again, that inflation can be tamed without a recession, or perhaps there’s a belief that a mild one would be acceptable. Certainly the RBA’s Governor Lowe is seeing the good times returning before too long, even as he talks up the need for more rate rises. He outlined three reasons we’ll see inflation fall next year. Listen in to find out more. Hosted on Acast. See acast.com/privacy for more information.
21/06/2022 • 16 minutes 52 seconds
Is the RBA preparing to go harder?
Tuesday 21st June 2022RBA Governor Philip Lowe is talking at an American Chamber of Commerce event this morning in Sydney. Phil asks NAB’s Ray Attrill whether he could signal that interest rates could push higher than 2.5 percent, even though he said that was a possible level to reach on the 7.30 Report only last week. Certainly central banks seem to be drifting to more aggressive hikes, with one voting member at the Bank of England concerned that if they fail to follow the path of the Fed that could devalue the pound and add to the inflation woes. Today, with the US having spent Monday on their Junteenth holiday, markets are relying on central bank speak for direction, and there’s a lot of it over the next 24 hours. Hosted on Acast. See acast.com/privacy for more information.
20/06/2022 • 18 minutes 3 seconds
Turning up the rhetoric
Monday 20th June 2022It’s almost like there’s a race to turn up the rhetoric between central bank speakers, signalling to markets that rates will keep going up and the increments might be quite large. Klaus Knott from the ECB, for example, is talking about a possible series of 50 basis point hikes, which is a long way from the gradualism we’ve been hearing about for most of this year. This morning NAB’s Rodrigo Catril also talks about the fate of the Aussie dollar, which has been impacted by falling commodity prices which itself, is driven by recession concerns. It’s a quiet start to the week, with bond and equity markets closed in the US for Juneteenth. Hosted on Acast. See acast.com/privacy for more information.
19/06/2022 • 17 minutes 26 seconds
Markets go cuckoo as the Swiss clock a half percent hike
Friday 17th June 2022The positive reaction to yesterday’s FOMC market was short lived, with a much softer US dollar this morning and big falls in equity markets. NAB’s David de Garis says some of the uncertainty comes from a surprise decision by the Swiss National Bank to lift interest rates for the first time in 17 years – and not by a little bit, but by 50 basis points. It’s unsettling for those who assumed they’d wait for the ECB before reacting. By comparison, the Bank of England went for a 25 basis point rise, exactly as expected, but suggesting they will act forcefully, in necessary. Just not yet. Data overnight was largely second tier, but none of it was particularly encouraging. We also take a quick look at yesterday’s Australian employment numbers too. Hosted on Acast. See acast.com/privacy for more information.
16/06/2022 • 15 minutes 56 seconds
A big step to the soft landing few believe will happen
Thursday 16th June 2022The FOMC announced a 75-basis point rise in interest rates in the US, with rates rising to 3.4 percent by the end of the year. Sat the press conference that followed Jerome Powell spelt out that the next rise would be 50 or 75 basis points at the next meeting. They continue to argue that all of this can be achieved with a soft landing, but as NAB’s Ray Attrill suggests, when has a central bank ever confessed to contributing to a recession. There was also an emergency meeting of the ECB yesterday, as they try to tackle fragmentation in the European union occurring from rising rates. Later on the Bank of England, expected to lift rates by 25 basis points. Also today, Aussie employment numbers and New Zealand GDP. Hosted on Acast. See acast.com/privacy for more information.
15/06/2022 • 17 minutes 34 seconds
The day before the dots
Wednesday 15th June 2022The FOMC meeting tomorrow morning (Australian time) has been the focus of intense speculation this week, with the surprise inflation numbers last week suggesting a more aggressive stance by the Fed. Some commentators are even pointing to a 100-basis point rise. NAB’s Rodrigo Catril says the dot plots from this meeting – showing the Fed’s own expectations of the path of rises – will be more significant than the rate decision itself. Meanwhile, Japan and China are struggling to constrain yields and the BoE faces an easier job as the UK economy slows itself down, without too much central bank intervention. Hosted on Acast. See acast.com/privacy for more information.
14/06/2022 • 16 minutes 9 seconds
Markets Panic after US inflation surprise
Tuesday 14th June 2022There have been massive moves in financial markets since the release of the US inflation data on Friday. The US dollar is around the highest in decades, bond yields have shot up, in many cases to the highest in more than a decade, and the S&P500 has fallen to its lowest level in 15 months. NAB’s Tapas Strickland says the concern is we are seeing inflation expectations de-anchoring. In other words, is panic creeping to the markets? The concerns are heightened by the meetings of the Fed, the Bank of England and the Bank of Japan this week. The UK might not see big moves by the central bank, but only because the economy is already slowing and, after today’s GDP numbers, could well be the first into a recession. Hosted on Acast. See acast.com/privacy for more information.
13/06/2022 • 17 minutes 52 seconds
ECB set to turn up the dial
Friday 10th June 2022The ECB indicated overnight that they will lift rates at their July meeting, and if there’s no sign of a fall in inflation then a bigger hike might be necessary in September. This is the most hawkish the ECB has sounded, but Phil Dobbie asks NAB’s Gavin Friend if it is enough? The prospect of more rate rises has accentuated concerns about the impact of southern European economies and Christine Lagarde’s proposals on how to deal with the problem failed to satisfy markets, with Italian and Greek bonds falling markedly again. Today’s CPI number for the US will be watched keenly. Has inflation peaked? Hosted on Acast. See acast.com/privacy for more information.
Thursday 9th June 2022There’s not much optimism in the air this morning. The OECD almost doubled their inflation expectations and slashed their growth forecasts, with the UK chosen for a particularly pessimistic outlook. NAB has revised its own forecasts for RBA rate hikes, outlined in today’s podcast. Oil prices have shot higher, with NAB’s Rodrigo Catril saying low inventories and the China reopening story means we haven’t reached the peak yet. The ECB meets later on. We know what to expect, although this is an environment where people change their minds at short notice. Hosted on Acast. See acast.com/privacy for more information.
08/06/2022 • 17 minutes 29 seconds
RBA, far from business as usual
Wednesday 8th June 2022It was only a month ago that RBA governor Lowe was suggesting a 25 basis point hike was business as usual, with the bank wanting to signal that things would return to normal with a standard adjustment in interest rates. As NAB’s Ray Attrill points out, it was only a few months ago that the RBA was suggesting rates weren’t going up until 2024. Things changed sharply yesterday. This morning we look at the market reaction, from bond yields and equities, to the cross-rate with the New Zealand dollar. There’s also discussion on the ECB, with the potential for bond purchases in southern European nations who will be hit hardest from rate hikes. Hosted on Acast. See acast.com/privacy for more information.
07/06/2022 • 15 minutes 37 seconds
Rates jump, Boris’ near miss, RBA today
Tuesday 7th June 2022There’s been lots of action on the markets overnight, with rates pushing higher and, for most of the session, equities on the rise too. NAB’s Tapas Strickland says reopening news from China has helped push equities higher, but the prospect of rate hikes has seen that optimism diminish as the session neared the close. In currencies, the pound was the best performer in the G10, rising on the news of a leadership challenge for UK Prime Minister Boris Johnson. He won the challenge and the pound started drifting down again, but there’s no guarantee he’ll stay in his job for long. The RBA is the main focus today, with NAB expecting a 25 basis point rise. There’s less urgency and, with more meetings, greater flexibility than with other central banks. Hosted on Acast. See acast.com/privacy for more information.
06/06/2022 • 13 minutes 18 seconds
Get ready for RBA, ECB and US CPI
Monday 6th June 2022It might be a quiet start to a busy week, with the RBA and ECB meeting, and the US releases its CPI numbers at the end of the week. NAB’s Skye Masters says there’s divided opinion on how far the RBA will push tomorrow – anywhere from 25 to 50 basis points. We know the ECB is moving slower, but we can expect they’ll give further signals about when rates will rise and by how much. It all depends on the inflation outlook, of course, with CPI for the US out on Friday. Meanwhile, markets have been looking for any evidence that price rises might have peaked, but with the uncertainty over oil, the war and China’s lockdowns, it’s a bold call to say we are there yet. Hosted on Acast. See acast.com/privacy for more information.
05/06/2022 • 13 minutes 23 seconds
More oil, weaker jobs growth. Equities live on hope.
Friday 3rdJune 2022Today saw another session demonstrating the violent swings across all asset classes. Equities, that were well down yesterday, are well up this morning, despite an earnings downgrade from Microsoft. A chunk of the optimism comes from news that OPEC+ will increase oil production, even though oil prices themselves rose today. NAB’s Ken Crompton says we haven’t seen the same response in bond markets because of the likelihood that the Fed will keep rising, even beyond September, Lael Brainard said as much overnight. Tonight US non-farm payrolls will be watched keenly for signs of a softening job market or a reduction in wages. Hosted on Acast. See acast.com/privacy for more information.
02/06/2022 • 15 minutes 37 seconds
Rates boosted as strong data support aggressive Fed hikes
Thursday 2nd June 2022If investors were looking for signs of weakness in the US economy, in the hope that it might moderate the expectations for a rapid path of rate rises from the Fed, they didn’t get it, says NAB’s Rodrigo Catril. Instead, the ISM manufacturing PMI for May came in higher than expected, job openings remained high and job quits haven’t really come down much. Nothing there to suggest the Fed needs to tread a more careful path, so bond yields have risen sharply and equities have fallen further. It’s a different picture in Australia, where a stronger GDP read is being taken as a sign that we might weather the storm better than most. Hosted on Acast. See acast.com/privacy for more information.
01/06/2022 • 15 minutes 33 seconds
EU sanctions, more in the pipeline?
Wednesday 1st June 2022The EU has agreed to an immediate ban on oil exported by sea from Russia, with a further ban on EU and UK insurance of Russian vessels exporting oil elsewhere. On today’s podcast NAB’s Taylor Nugent discusses the tightening of restrictions and the impact on commodity prices and Europe’s rising inflation numbers – which exceeded expectations overnight. Meanwhile, a meeting between Biden and Powell today, representing two supposedly independent entities, demonstrates the dichotomy between controlling inflation and avoiding economic hardship. Today’s Australian GDP numbers will demonstrate how we have it better than most with 0.7% growth expected QoQ – although that figure would have been higher without a higher negative trade balance. Hosted on Acast. See acast.com/privacy for more information.
31/05/2022 • 17 minutes 5 seconds
German inflation concerns, but equity markets refuse to freak out
Tuesday 31st May 2022There isn’t much in the way of good news today, but that doesn’t seem to matter as far as equity markets are concerned. German inflation was a big upside surprise and other numbers out of Europe suggested things are perhaps worse than imagined. Oil is rising sharply and could well surpass the previous peak. The war in Ukraine continues unabated with Russia making further inroads in the east of the country. China is easing lockdowns, but for how long? Yet European shares rose the Futures suggest the US will open higher on Tuesday too. NAB’s David de Garis talks about markets are looking on the bright side of the downside. Hosted on Acast. See acast.com/privacy for more information.
30/05/2022 • 14 minutes 57 seconds
A piggy bank backed recovery
Monday 30th May 2022Markets seem to be optimistic that the inflation wave can be ridden without us all crashing down on a rocky outcrop somewhere. So, are they right? NAB’s Ray Attrill joins Phil Dobbie this morning to discover the positive mood in the markets – particularly equities – driven by an absence of bad data and a hope perhaps that inflation will be tamed before central banks have to go the full way on interest rate rises. To what extent is demand holding up because people can dip into the extraordinary level of extra savings accumulated since the start of the pandemic. The non-farm payrolls data at the end of the week will be of interest, particularly in relation to wages. Locally, GDP numbers are out middle of the week. There are only three days this week when the US and UK markets are open, with month-end in-between. It could be a choppy week. Hosted on Acast. See <a style='color:grey;' target='_blank' rel='noopener norefe
29/05/2022 • 16 minutes 43 seconds
Equities and bonds markets divided
Friday 27th May 2022US equities rose sharply again today as more retailers gave positive outlooks, despite the earlier surprise form Walmart and Target. The optimism wasn’t impacted by another set of weaker data from the US. That presumably means there’s potential for damage if today’s consumption numbers surprise on the downside, or the PCI-deflator shows higher than expected inflation levels. As NAB’s Gavin Friend points out, the bond markets have not reacted the same way, positioned as they are for a series of rate hikes from the Fed and the question mark over a recession. The UK Chancellor Rishi Sunak tried to head off recession with the announcement of a large round of fiscal stimulus, funded by a one-off windfall tax on energy companies. But is it enough? And what happens next year? Hosted on Acast. See acast.com/privacy for more
26/05/2022 • 16 minutes 23 seconds
Markets accept rate hikes if they tame inflation
Thursday 26th May 2022The increasing belief amongst central bankers – particularly in New Zealand and the US – is that faster rate hikes will have a more marked impact on fighting inflation, giving more flexibility on how to handle the issue later in the year. NAB’s Rodrigo Catril isn’t sure that a couple more 50 basis point hikes from the FOMC will be enough. Supply chain issues remain for goods, and consumers need to be torn away from their rising consumption of services. Today, Australia’s Q1 Capex numbers are worth looking out for. Also today, if the world seems a worrying place right now (particularly if you’ve been listening to George Soros), calm yourself down with a picture of a fluffy cat. It worked for our host. Hosted on Acast. See acast.com/privacy for more information.
25/05/2022 • 17 minutes 55 seconds
Markets Snap Out of It
Wednesday 25th May 2022Yesterday’s upbeat sentiment was very short-lived, with a sharp fall in equities and bond yields today. A statement from Snap! about a worsening environment hitting revenue projections sent shares down across the board, but particularly advertising reliant tech stocks. That wasn’t the only bad news of the day. As NAB’s Tapas Strickland outlines in today’s podcast, there’s been a plunge in new home sales in the US, and a sharp fall in service PMIs in the UK. On the back of all of this, markets are expecting central banks to move a little slower on rate hikes, with the Fed’s Raphael Bostic warning policy makers to ‘proceed carefully’. We also look at the RBNZ decision today and Australia’s construction numbers this morning. Hosted on Acast. See acast.com/privacy for more information.
24/05/2022 • 16 minutes 49 seconds
Hope springs eternal, well, for today anyway
Tuesday 24th May 2022A bounce back in equities and a better-than-expected IFO read from Germany. For today at least we’re seeing the return of some risk sentiment, as money piles into equities and bonds are sold off, pushing yields higher. NAB’s Taylor Nugent says there wasn’t anything obvious to prompt this risk turnaround, except perhaps some positive words from Joe Biden about the potential easing of tariffs with China. That might paint a happier long-term picture, but supplies from China remain an issue, with Beijing seeing an increase in COVID cases. Oil continues to be pulled in all directions, even as it becomes clear that Russian oil sanctions are having little effect. It’s PMI day today – perhaps we’ll see some upside surprises to add to the upbeat sentiment. Hosted on Acast. See acast.com/privacy for more information.
23/05/2022 • 15 minutes 20 seconds
New Australian government, same global concerns
Monday 23rd May 2022Will a new government have any market impact? NAB’s Skye Masters has been looking at how markets behaved, relatively speaking, in the first few months of a new government. Irrespective of history ,the reality is, of course, that global concerns are far greater this time round, with markets pulled between inflation concerns and recession fears. The Fed’s James Bullard doesn’t think a recession is the on the cards for the US and thinks inflation can be beaten by next year if they push rates fast enough this year. The UK demonstrated that, despite price pressures and very low consumer sentiment, people are still shopping. It shows the importance of data right now, as we all try to grapple with the direction of economies the world over. Hosted on Acast. See acast.com/privacy for more information.
22/05/2022 • 16 minutes 3 seconds
Who can slow down the slowdown?
Friday 20th May 2022There was no bounce in equities today after the big falls we saw yesterday. NAB’s Taylor Nugent says its growing concerns about the US growth outlook, driven by earnings results and no uptick in economic data. Cisco has been the latest to downgrade their forecasts, blaming supply chains from the war and China’s lockdowns. But equity markets can normally see through short-term impacts, but not right now. Is the concern of over-reach by central banks part of the concern? And what does yesterday’s Australian employment data mean for inflation and the response from the RBA? There’s also a look at the minutes form the latest ECB meeting which ,again, highlighted the divide within the board about the need to act on inflation versus the impact on economic growth. Very much the question of the day. Hosted on Acast. See acast.co
19/05/2022 • 15 minutes 39 seconds
Equities bomb as investors are reminded of inflation
Thursday 19th May 2022We’ve seen big falls in US shares as major retailers issue profit warnings, based on inflation and supply chain worries. Investors responded quickly. Had they forgotten that inflation was a thing? It was a timely reminder, says NAB’s Ray Attrill, that headline inflation hits consumer spending, so consumer staples and discretionaries will feel the pinch. The UK’s CPI hit 9 percent, but was in line with expectations. Canada’s inflation number was higher than anticipated, however. Australia’s wage growth remains relatively subdued, but the RBA’s focus will be on today’s labour market data. Hosted on Acast. See acast.com/privacy for more information.
18/05/2022 • 15 minutes 52 seconds
China reopening, Americans shopping, Brits working
Wednesday 18th May 2022Equity markets have rallied today, buoyed by positive retail numbers for the US. But NAB’s Rodrigo Catril says the sentiment really improved in APAC yesterday on news that Shanghai will reopen after three days of zero COVID infections. Markets turned when the Fed’s Jerome Powell spoke about pushing beyond neutral to curb inflation, but shares rebounded soon after. Britain’s job numbers would look fantastic at any other time but now – instead, lower unemployment and rising vacancies spells out further inflation risks which will encourage the BoE to move faster, perhaps. Even the cautious ECB has one member talking about a 50-basis point rate hike. Today Australia’s wage price index will be watched keenly because it could be influential in the RBA’s next move up in rates. Hosted on Acast. See acast.com/privacy for
17/05/2022 • 17 minutes 18 seconds
Markets tossed back and forth in a sea of uncertainty
Tuesday 17th May 2022There’s been a fair bit of volatility in equity and bond markets overnight. Stocks are generally down after swings back and forth through the session. NAB’s Ken Crompton says there’s a continuing tension between the Fed talking up rate rises and whether that will prompt a recession. The data flow hasn’t offered anything encouraging. China’s retail sales were well down the NY State Manufacturing Index was pulled down by a fall in new orders, and the European Commission, understandably, lowered their growth forecasts and upped their inflation expectations. Meanwhile oil pushed higher and wheat prices ha e been hit by an export ban from India. Today US retail sales will show whether inflation is hitting demand yet and Christine Lagarde will have a chance to talk-up a July rate hike in Europe. Plus the minutes of the last RBA meeting. Hosted on Acast. See <a style='color:grey;' target='_blank' rel='noopener noreferrer'
16/05/2022 • 15 minutes 47 seconds
One day when fears eased, for a bit
Monday 16th May 2022There was a slight reversal in sentiment on Friday, with the US dollar losing ground, equities climbing and bond yields rising. NAB’s Tapas Strickland says news of the easing of lockdowns in Shanghai this week might have provided an excuse for this switch around, but news over the weekend could make this change in direction very short lived, with China relinquishing its staging of the 2023 Asia Cup (soccer). In Europe, Sweden and Finland have both announced they intend to join NATO. If that wasn’t enough to upset Putin, Ukraine won the Eurovision Song Contest. Today, eye swill be on China’s fixed asset investments, industrial production numbers and retail sales, and on the continuing debate about whether the Fed (or any central bank) can deliver a soft landing from the inflation battle without forcing a recession. Hosted on Acast. See <a style='color:grey;' target='_blank' rel='noopener noreferrer' href='https://ac
15/05/2022 • 16 minutes 16 seconds
A world of worry
Friday 13th May 2022US equities continue to take a hit as inflation concerns continue and two of the biggest contributors – the war and China lockdowns – show no signs of abating. The war won’t go away, with Sweden and Norway now pushing for fast-tracked NATO membership. Reports suggest Beijing is now significantly in lockdown, which could further damage the Chinese economy and foreign trade. Here we are, says NAB’s David de Garis, wondering how low shares will go before we see anything like the Greenspan put come into play! A bigger worry for the UK is the cost of living, with March GDP numbers showing the economy retracted, and it will almost certainly be worse in April. Also today, we compare and contrast the direction of house prices in the UK and New Zealand. Hosted on Acast. See acast.com/privacy for more information.
12/05/2022 • 17 minutes 17 seconds
US inflation numbers hit shares, bond markets more restrained
Thursday 12th May 2022US inflation numbers didn’t fall as much as hoped, in fact the core number is up, making the job for the Fed that little but harder. There’s been a sharp response on the share markets, particularly for tech stocks, but less of a reaction in the bond markets. On today’s podcast NAB’s Skye Masters says there’s been a flattening of the yield curve, suggesting that the expectation is that the Fed won’t need to push further in its terminal rate. Meanwhile, Christine Lagarde has finally joined the ECB’s July rate-hike brigade, and the pound has taken a hit as Britain threatens to unilaterally pull out of a key component of the Brexit agreement with the EU, threatening a trade war. Hosted on Acast. See acast.com/privacy for more information.
11/05/2022 • 15 minutes 58 seconds
A momentary lapse of reason
Wednesday 11th May 2022For a while today US shares were pushing higher, with tech stocks leading the way. Then as market close neared, prices started to fall and gains were effectively halved. NAB’s Rodrigo Catril says he is sceptical about hopes of a rebound, because the headwinds remain, particularly continued lockdowns in China, which will have a lag impact on the rest of the economy. How much of that lag will be reflected in US CPI later today? Meanwhile, the NAB business survey shows Australia is faring rather better than most of the world, right now. Hosted on Acast. See acast.com/privacy for more information.
10/05/2022 • 17 minutes 46 seconds
Stocks dive over fears of the perfect storm
Tuesday 10th May 2022Markets are clearly concerned that there will be no soft-landing. There’s the big fear that rate rises won’t cut demand enough to compensate for inflation driven by supply chain disruption. The result, we’re seeing inflation expectations remaining high, stocks taking big hits and the US dollar possibly the only safe haven there is. So, what will turn this situation around? NAB’s Taylor Nugent says there has been no major data releases or news items to drive sentiment today, but risk-off uncertainty prevails. We have to wait for signs that inflation is starting to unwind. It might be way too soon, but signs of an easing of inflation in tomorrow’s US CPI would be very welcome. Hosted on Acast. See acast.com/privacy for more information.
09/05/2022 • 14 minutes 1 second
Are markets running scared?
Monday 9th May 2022Equity markets continued their falls on Friday, driven by concerns that the FOMC will let the economy slip into recession if it’s needed to keep inflation under control, just as the BoE warned last week. NAB’s Tapas Strickland says some Fed speakers have suggested a faster rate of tightening will be needed if supply chain difficulties aren’t corrected in a hurry. Given the China and Ukraine situations, that seems unlikely. Inflation concerns are rising everywhere. Even the ECB is expected to hike rates soon, and though the RBA’s path is somewhat slower than most there are concerns that they too might be underestimating the hit inflation could make and will need to correct quickly. All in all, a lot of investors will be looking eagerly for any signs that supply chain problems are improving. Hosted on Acast. See acast.com/
08/05/2022 • 16 minutes 52 seconds
Market whiplash as sentiment takes a hit
Friday 6th May 2022Yesterday, as Jerome Powell gave the post-FOMC press conference, the US dollar strengthened, equities shot up and front-end bond yields fell sharply. Today, there’s been a swift reverse. The dollar is the highest in years, 10-year Treasuries are well over 3% and the share market has seen one of the biggest turnarounds ever. Does this suggest markets have a growing fear of a hard landing from the hawkish Fed rate path? NAB’s Gavin Friend says it is a challenging pathway for the Fed, but inflation will come down, hopefully, before causing too much turmoil in the economy. The risk to the economy was outlined by the Bank of England Governor Bailey, as they raised interest rates 25 basis points. Their forecasts make grim reading. And the Aussie dollar took a hit as risk sentiment soured. There will be a lot of interest in the projections in today’s Statement of Monetary Policy. Hosted on Acast. See <a style='color:grey;'
05/05/2022 • 17 minutes 6 seconds
Powell knocks mega-rise prospects on the head
Thursday 5th May 2022The FOMC announced a 50 basis point rate rise for the US. As NAB’s Skye Masters notes in today’s podcast, the market response was fairly muted until Jerome Powell gave his press conference shortly afterwards. One comment, that they were not contemplating a 75-basis point rise, sent bond yields diving lower and equities shooting higher. Skye says markets had priced well ahead for a hawkish Fed, now they are taking some of that pricing back. But uncertainty hasn’t fallen away, with or inflation signs in New Zealand’s employment data, in Australian retail numbers and with another day of rising oil prices. We can expect a less hawkish Bank of England later, but it’s still likely they will raise rates even with the cost-of-living crisis being faced in the UK. Hosted on Acast. See acast.com/privacy for more information.<
04/05/2022 • 16 minutes 34 seconds
RBA loses a little patience
Wednesday 4th May 2022On today’s podcast NAB’s Ivan Colhoun talks through the RBA’s higher-than-expected rate hike yesterday. Taylor Nugent adds that it was clearly more than expected, given the rise in front-end bond yields after the meeting, buoyed on by more hawkish rhetoric from the RBA’s Governor Lowe after the meeting. Next it’s the FOMC, early tomorrow morning, with a 50 basis point rise still anticipated. The JOLTs numbers indicated the labour market is still very tight and the challenge will be to restrain wage inflation. Job numbers and wages data tonight and Friday might add fuel to the fire. This morning, lots of focus on wage inflation in New Zealand, with employment data out and a press conference from the RBNZ. Hosted on Acast. See acast.com/privacy for more information.
03/05/2022 • 15 minutes 12 seconds
Breaking the Three Percent Barrier
Tuesday 3rd May 2022US 10-year Treasury yields snuck over three percent overnight, albeit briefly. But NAB’s Ray Attrill says this could be the psychological baseline that sees rates grow higher. The latest ISM showed a slowing growth in US manufacturing, the result of lockdowns in China, but the Fed is still expected to push ahead with a significant rise later this week. Before that, the RBA meets today and the expectation is that they’ll raise rates by 15 basis points, but some see an argument to push them up to 0.5%. Also, today, a flash crash in Swedish equities. Hosted on Acast. See acast.com/privacy for more information.
02/05/2022 • 15 minutes 13 seconds
The week central banks get serious
Monday 2nd May 2022Last week finished with stocks well down in the US, particularly amongst high-growth tech-stocks. The reason, growing inflation concerns. NAB’s Rodrigo Catril says a 50-basis point hike from the Fed is very likely later this week, with growing market expectations that it could be followed by a 75-basis point rise next month. Meanwhile, there were further signs of growing inflation at the end last week that inflation, including a big rise in core inflation for Europe, rising producer prices in Australia and higher than expected wage growth in the US. Hosted on Acast. See acast.com/privacy for more information.
01/05/2022 • 16 minutes 16 seconds
A fall in US GDP doesn’t signify recession, yet
Friday 29th April 2022The US delivered a sharp fall in GDP in the first quarter. It wasn’t expected and could naturally spark fears that recession could be coming to the US sooner rather than later. But NAB’s Tapas Strickland says ‘beneath the hood’ the numbers showed that the US economy was still performing relatively well, with the numbers dragged down by a larger negative trade balance and lower inventories. As a result, equities continued to push higher, along with the US dollar. Inflation fears are rising in Europe though, with a higher-than-expected CPI read for Germany. These concerns pushed front-end yields higher and forced the Riksbank to unexpectedly lift their rates. Hosted on Acast. See acast.com/privacy for more information.
28/04/2022 • 14 minutes 48 seconds
RBA will hike next week
Thursday 28th April 2022Australian inflation rose more than expected yesterday. NAB’s Ivan Colhoun said it didn’t come as a complete surprise. NAB’s Business Survey has been showing rising input costs, and its likely inflation will rise till further in the next quarter. All that points to a high likelihood that the RBA will lift interest rates next week. Elsewhere, markets have had a temporary does of optimism, although NAB’s Rodrigo Catril says a resolution has to be found for Europe’s energy problems. There just aren’t enough global supplies to completely cut out Russia. US GDP and German CPI are two significant data releases today, along with the business activity outlook for New Zealand. Hosted on Acast. See acast.com/privacy for more information.
27/04/2022 • 17 minutes 1 second
Russia turns off gas for Poland and Bulgaria
Wednesday 27th April 2022Big market moves today, with US shares plummeting, bond yields also falling, and commodity prices rising sharply. European gas prices shot up on the news that Russia intends to turn off gas supplies to Poland and Bulgaria almost immediately, for not paying in Roubles. Whilst Europe debates whether they should ban buying Russian gas, perhaps the decision will be made for them. NAB’s Ray Attrill says recession fears on a global scale are also impacting sentiment, particularly as the war in Ukraine is clearly with us for some time, and China’s lockdown fears. Today, Australia’s CPI will be the numbers to watch. Could they rise enough to drive the RBA to a rise as soon as next week? Hosted on Acast. See acast.com/privacy for more information.
26/04/2022 • 15 minutes 59 seconds
Front end Fed and China’s quest for the impossible
Tuesday 26th April 2022There’s been a strong risk-off sentiment to the start of the week. NAB’s Taylor Nugent says equity investors belatedly “got the memo” on the Fed’s front-end loading for rate rises. Fears of more lockdowns in China, including Beijing, have added to the uncertainty, even though the fatality rates are low in comparison to many opened-up western nations. It seems China’s zero-COVID focus and the ongoing impacts of the Ukraine war are two issues that won’t slip away anytime soon. US GDP and Australian CPI will be two of the main focuses data-wise this week. Hosted on Acast. See acast.com/privacy for more information.
25/04/2022 • 14 minutes 51 seconds
European bonds rise sharply as some ECB members talk up rate schedule
Friday 22nd April 2022Markets are a little easier to understand today. Bond yields are back on the rise, given inflation expectations and more hawkish rhetoric from central banks. That’s hit equities. NAB’s Ken Crompton agrees that it’s a more text-book response to what we have been seeing, with equities and yields rising in tandem. There have been particularly strong moves for front end yields of European bonds, with some members giving a more hawkish timetable for rate rises. Today PMIs will be closely scrutinised to get a flavour of growth and conditions across Europe, the UK and USA. Hosted on Acast. See acast.com/privacy for more information.
21/04/2022 • 17 minutes 8 seconds
A Temporary Change in Direction
Thursday 21st April 2022Bond yields have fallen sharply overnight, but that doesn’t mean inflation expectations are going away, or does it? NAB’s Taylor Nugent says the Fed’s Beige Book, out overnight, highlights some examples of how inflation might be nearing its peak, but there are plenty to suggest otherwise. For example, Canada’s CPI and German PPIs, two sets of numbers showing prices are still rising, at quite a rate. NZ CPI numbers are out soon. Also today, a short-term reprieve for the Yen, whilst the Yuan falls to a six-month low. The Zero COVID approach had an impact on Japan’s export numbers, and will add to global inflation worries. And what about their attitude towards Russia? If you want a healthy dose of geopolitics, the French Presidential debate is also on today, ahead of the weekend election, and it’s close. Hosted on Acast. See <a style='color:grey;' target='_blank' rel='noopener noreferrer' href='https://acast.com/p
20/04/2022 • 15 minutes 53 seconds
Bond yields and equities both rise sharply. Please explain.
Wednesday 20th April 2022It’s not something that will continue for long, but US bind yields have risen sharply today, and so have equities. Which one will give in first? Equities have risen because of strong earnings results but, as NAB’s Ray Attrill observes in today’s podcast, there’s still a long way to go. Bond yields are rising as Fed speakers up the ante on the path of interest rates, with one even raising the prospect of a 75-basis point rise at the next meeting. Meanwhile, oil is down sharply today, with the IMF downgrading global growth forecasts, except in Australia. There’s also discussion on the RBA minutes and the fall in the Japanese Yen. Hosted on Acast. See acast.com/privacy for more information.
19/04/2022 • 15 minutes 41 seconds
A whiff of moderation as Fed hurtles to 50 point hike
Tuesday 19th April 2022There’s a fundamental difference in the approach of the ECB and the Fed, as NAB’s Tapas Strickland explains on today’s podcast. Whereas the Fed is focused on inflation, the ECB is also concerning itself with growth. Could we see rising prices curtail that growth faster than anticipated? What about rising rates. The IMF has warned that rising rates will drive deleveraging that will have a marked impact on GDP growth. We also look at lockdowns in China and whether the rising bond yields in the US will offset any positive news to come from earnings results this week. Hosted on Acast. See acast.com/privacy for more information.
18/04/2022 • 15 minutes 29 seconds
Big hikes, more inflation, but bonds settle down
Thursday 14th April 2022Despite 50 basis point hikes by the Bank of Canada and the RBNZ over the last 24 hours, bond yields haven’t moved a great deal. NAB’s Gavin Friend says the market has taken a bit of a breather, which has offered a reprieve for stocks, with the NASDAQ climbing 2 percent at close. The path is certain for Canada and New Zealand, but it’s a less clear direction for the ECB, which meets tonight, with no moves expected as Europe struggles with rising energy prices and the impact of Russian sanctions. Similarly, the UK has just reported the highest CPI read in 30 years and it will only get worse, but the cost-of-living squeeze is making it hard for the Bank of England to look at big moves in a hurry. Today’s employment numbers for Australia will be keenly watched by the RBA, who will be looking at prospects for wage rises driven by an even tighter labour market. Hosted on Acast. See <a style='color:grey;' target='_bla
13/04/2022 • 15 minutes 52 seconds
A very slight glimmer of hope on inflation
Wednesday 13th April 2022US inflation rose as expected, but there’s still been a reaction in the bond markets. NAB’s Taylor Nugent says investors latched onto the core CPI read coming in slightly softer than expected or feared. The subtly of the change wasn’t picked up by equity markets which fell, pushed lower by rising oil prices and the realisation that inflation is still here and could get worse. The NAB Business Survey yesterday demonstrated how Australia isn’t exempt, as Ivan Colhoun explains on today’; s podcast. Later on, two central banks who might well lift rates by 50 basis points – the RBNZ and the Bank of Canada. Hosted on Acast. See acast.com/privacy for more information.
12/04/2022 • 14 minutes 48 seconds
Stocks hit as yields rise higher still
Tuesday 12th April 2022US bond yields continue to career higher. ‘IT was another blistering night’ says NAB’s Tapas Strickland, with 10-year Treasury yields reaching a three-year high. With no new news, he says, it’s a continued reaction to the hawkish Fed agenda. But could it all backfire? The Fed has never had successive 50 basis point rises. There are still concerns that they could spark a recession if they move too quickly, particularly as supply chain difficulties won’t be resolved by monetary policy. And the rising COIVD cases in China suggest there will be more supply constraints to come. With inflation front and centre of everyone’s attention right now, US CPI figures are obviously the numbers to watch for. Hosted on Acast. See acast.com/privacy for more information.
11/04/2022 • 15 minutes 48 seconds
Rates push ever higher as food prices soar
Monday 11th April 2022Although there’s clearly volatility in markets, NAB’s Ray Attrill says the common thread is that yields are still rising. Even if the inversion in the curve has dissipated, the fact remains 10-year yields are at multi-year highs as inflation fears grow and central banks respond. Food prices have risen almost 13 percent in one month, even worse if you cook with vegetable oil. This might be reflected in China’s CPI numbers today, and for the US mid-week. The war will have a strong influence on this, and there are no signs it will dissipate anytime soon. Meanwhile several central banks meet this week, including the ECB. Markets are priced for a 50-basis point rate hike by the Bank of Canada. Hosted on Acast. See acast.com/privacy for more information.
10/04/2022 • 15 minutes 42 seconds
Consumers still spending despite all the hike talk
Friday 8th April 2022As bond yields continue to rise, particularly in the US, it seems there’s not much impact from all the hike talk on consumer spending just yet. Consumer credit numbers in the US shot up in February, much of it revolving credit. Will that just add to the Fed’s concerns and the accelerated rate of hikes, which has seen bond yields push ever higher. Ken Crompton says NAB’s forecast is for 10 yields to reach 3 percent by the end of the year, but there is still considerable room for movement. Yesterday’s Australian balance of trade numbers were a surprise, with much higher imports pushing February’s surplus down by $4.5 billion from the month before. Whilst the ECB minutes overnight reflect a more hawkish approach, but a bank still heavily divided on the road to take. Hosted on Acast. See acast.com/privacy for more info
07/04/2022 • 13 minutes 9 seconds
Fed to slash balance sheet sooner rather than later
Thursday 7th April 2022Bond markets have reacted sharply and briefly to the FOMC minutes this morning, which suggested the Fed might start slashing its balance sheet sooner rather than later. This added to the sentiment expressed by Lael Brainard earlier in the week, which saw the yield curve steepening a little. Phil Dobbie asks NAB’s Gavin Friend what these moves are telling us, and why the impact has cut short the strengthening of the Aussie dollar. Maybe strong trade numbers today will turn it around again. There’s also discussion about German factory orders and tonight’s ECB minutes. Hosted on Acast. See acast.com/privacy for more information.
06/04/2022 • 15 minutes 2 seconds
No patience left at RBA
Wednesday 6th April 2022The RBA has lost its patience and wants to move fast, but how fast and how far? On today’s podcast NAB’s Ivan Colhoun says it’s unlikely we’ll reach the 3% terminal rate that markets are anticipating, or at least with the expected rapidity. Taylor Nugent – new to the Morning Call – looks at the market response to words from the Fed’s Lael Brainard overnight, who talked about balance sheet reduction, possibly as soon as next month, at a faster pace than before. The Fed minutes today might add more substance to interest rate expectations, whilst two members of the RBA front a senate hearing today, where questions will not doubt be asked about the sudden pivot in policy signalling. Hosted on Acast. See acast.com/privacy for more information.
05/04/2022 • 16 minutes 25 seconds
Crimes, curves and patience
Tuesday 5th April 2022The hope of peace in Ukraine is slipping away as more evidence of war crimes emerges, suggesting diplomacy could take some time. The Euro fell as expectations rose for more sanctions against Russia, which also pushed oil higher. NAB’s Tapas Strickland says negotiations are continuing though and we shouldn’t underestimate the chance for some sort of truce to be found. Meanwhile, inflation remains a global concern, particularly in the US. The inverted yield curve is also a cause for consternation. Tapas suggests the FOMC should have moved sooner on rates and speculates that the RBA will be watching and learning. Will the word ‘patience’ disappear from today’s RBA statement? Hosted on Acast. See acast.com/privacy for more information.
04/04/2022 • 13 minutes 59 seconds
Fed ready for a big move, ECB staring inflation in the face
Monday 4th April 2022Non-farm payrolls gave the hawks at the Fed the ammunition they wanted, and bond yields have responded. NAB’s Rodrigo Catril says the data on Friday has cemented in the expectation of a 50bp rate hike at their next meeting. The ECB is still reticent to talk about bringing their schedule forward, even though Friday’s Eurozone inflation numbers were a lot higher than expectations. Today we get to hear how the BoE’s Andrew Bailey expects to balance rising inflation against an economy that has already slowed (possibly to zero). And what of the RBA? Will tomorrow bring a signalling of a faster path to a rate hike? Also today, has oil fallen too far? The situation in Ukraine looks like it won’t end soon, yet oil is less than 10% higher than before the invasion. Hosted on Acast. See acast.com/privacy for more information
03/04/2022 • 15 minutes 27 seconds
Biden dips into reserves, Putin demands Roubles from today
Friday 1st April 2022There’s a hefty emphasis on oil and gas this morning. Putin is demanding payment in Roubles from today, but there seems to be some caveats and so the impact isn’t as pronounced as you might expect. More significantly, President Biden has announced a six-month commitment to a daily draw down from the US strategic oil reserves. Will it be enough to make a difference? NAB’s Ken Crompton says the markets seem to think so, with a significant fall in the WTI price this morning. Also today, we look at China’s PMIs, which are firmly in contraction territory as they pursue their zero-COVID policy. And tonight, non-farm payrolls, where the focus might be more on wage inflation than the jobs numbers themselves. Hosted on Acast. See acast.com/privacy for more information.
31/03/2022 • 16 minutes 15 seconds
Peace hopes fade, European inflation soars
Thursday 31st March 2022There was hope in market pricing earlier in the week that some sort of resolution over Ukraine could be sought soon. But those hopes faded when Russia started bombing regions it had indicated it would pull back from. Today, oil prices are back up and US equities have been hit hard. It’s not all down to Ukraine though. Inflation rates in Germany and Spain are through the roof. As NAB’s David de Garis points out, they have risen more in a month than Australia has seen in a year. That presents a special challenge for the ECB, who have to control inflation in an environment where consumers will be facing a cost-of-living squeeze. Hosted on Acast. See acast.com/privacy for more information.
30/03/2022 • 14 minutes 28 seconds
Europe boosted by peace hopes
Wednesday 30th March 2022Markets have responded perhaps a little too favourably to peace negotiations between Russia and Ukraine in Turkey overnight. There wasn’t a concrete outcome, yet the Euro is riding high, stocks have risen sharply and bund yields are up. NAB’s Ray Attrill says even if some sort of resolution is found soon, sanctions will remain for some time to come. Meanwhile, front end yields continue to rise in the US as more Fed speakers talk-up the prospect of a 50 basis point hike at the next FOMC meeting. We saw a brief 5-10 year yield inversion, but blink and you missed it. Also today, NAB’s Ivan Colhoun talks through Josh Frydenberg’s pre-election budget. Hosted on Acast. See acast.com/privacy for more information.
29/03/2022 • 15 minutes 41 seconds
The divided story of rate expectations
28/03/2022 • 15 minutes 26 seconds
Ditching bonds like they are going out of fashion
Monday 28th March 2022The sell-off of bonds continues, with a further spike in yields at the end of last week. NAB’s Tapas Strickland says it’s because there is heightened expectations that the Fed will lift rates even faster than previously thought, possibly even four 50 basis point rises this year. Yet the share market – in the US and Europe – continues to rise. We look at why in this morning’s podcast, plus Shanghai in lockdown, how the Yen has lost its safe haven status and the ongoing impact of the war in Ukraine. Hosted on Acast. See acast.com/privacy for more information.
27/03/2022 • 16 minutes 18 seconds
American markets doing well because they are not Europe
24/03/2022 • 15 minutes 37 seconds
Getting ready to Ruble
Thursday 24th March 2022Bond yields have come back a fair bit today. NAB’s Gavin Friend says it’s just a recalibration after the massive hikes we’ve seen over recent days. The tone from the FOMC certainly hasn’t changed. Meanwhile oil prices have risen sharply, in part because President Putin has threatened that Europe should pay for gas in Rubles, rather than dollars or Euros. If it’s an attempt to get the West to roll back on sanctions he might be disappointed, with Biden meeting with the EC, NATO and G7 over the next day or two, where the one question on everyone’s mind will be, “what do we do next?” And for an early sign of the impact of the war on Europe, the UK and USA, flash PMIs are out later on. Hosted on Acast. See acast.com/privacy for more information.
23/03/2022 • 14 minutes 41 seconds
Markets support the Fed’s balancing act
Wednesday 23rd March 2022Just three weeks into March and US two-year bond yields are up 74 basis points, says NAB’s Tapas Strickland, on today’s Morning Call. Will the Fed be happy to see the market responding in this way, particularly as there’s less growth later in the yield curve? Does that suggest there are some concerns about whether Fed can keep inflation in check, without causing a recession. What does history tell us about the chances of that happening? Meanwhile the Yen is a casualty from all this bond action, with their central bank a long way off any sort of tightening. And the rise in oil prices has stalled today, we look at the reason. Today, UK’s CPI is the main set of numbers. Inflation and more of it. Hosted on Acast. See acast.com/privacy for more information.
22/03/2022 • 14 minutes
Powell talking faster than fast
Tuesday 22nd March 2022Bond yields have moved sharply higher as markets expect the Fed to move faster on rate rises and, potentially, drawdowns on the balance sheet. After Jerome Powell spoke overnight, NAB’s Ray Attrill says there’s now a much stronger expectation that April’s meeting will see a 50 basis point rate hike and, perhaps, the same again at the next meeting. Could the ECB also be stepping up its plan of action? Christine Lagarde talks later today. Inflation worries won’t be helped by the rise in oil prices, with no obvious short-term solution. An increase in production from Saudi Arabia seems unlikely because they are upset about the US withdrawal of arms sales over the war in Yemen. The Ukraine crisis looks set to continue, and any step up in action by Russia could increase the extent of sanctions including the possibility of an oil ban by the EU. Hosted on Acast. See <a style='color:grey;' target='_blank' rel='noopener no
21/03/2022 • 14 minutes 17 seconds
Peace hopes and understanding
Monday 21st March 2022Nobody really knows how the war in Ukraine will play out, but we kick off the week with reports from Turkey that an understanding between Ukraine and Russia might be closer. There’s even speculation that the two leaders will meet face to face – obviously at opposite ends of a very long table. On today’s Morning Call Phil Dobbie talks to NAB’s Ray Attrill about the market optimism right now, with equity markets rising despite the prospect of many rate hikes this year. Supply chain disruption looks set to be with us for longer, with more lockdowns in China over the weekend. But it's the words from Fed speakers that will be the focus of attention at the start of the week – will they support the hawkish stance of the FOMC last week or try to rein back a bit? Hosted on Acast. See acast.com/privacy for more information
20/03/2022 • 13 minutes 3 seconds
BoE far more cautious than the Fed
Friday 18th March 2022After a very hawkish Fed yesterday, the Bank of England has presented a much more guarded approach for the rest of the year, whilst delivering the third interest rate in a row. NAB’s Gavin Friend talks about why the central bank has a reluctance to signal too much right now. Meanwhile, are markets concerned that the Fed is moving too fast? There’s discussion about Aussie unemployment numbers too and what the strong numbers mean for the RBA. The Bank of Japan is the next central bank, but inflation driven by a tight labour market is much less of a concern for them. Oil prices are rising as hopes of a rapid end to the war dissipate but there are still irons in the fire, including talks between President Xi and President Biden. Hosted on Acast. See acast.com/privacy for more information.
17/03/2022 • 15 minutes 48 seconds
A far from transitory Fed
Thursday 17th March 2022The Fed has met, they’ve lifted rates in the US, and given a hawkish outlook for rate increases this year and next, with a terminal rate of 2.8 percent by the end of next year. The statement and subsequent press conference left some questions unanswered. NAB’s David de Garis points out how they plan to get inflation under control without unemployment rising, even by the end of 2024. Markets reacted swiftly to the announcement, with sharp rises in front end yields. The Bank of England meets later today, and inflation numbers overnight highlight the size of the task ahead for the Bank of Canada. And oil prices are falling as hope remains that a solution can be found to the war in Ukraine. Hosted on Acast. See acast.com/privacy for more information.
16/03/2022 • 17 minutes 2 seconds
China hit by COVID and Russian relationship
15/03/2022 • 15 minutes 42 seconds
Will China pick a side?
Tuesday 15th March 2022China and the US have been meeting, with the hope that talks can resolve the war in Ukraine. But China is showing little sign of offering total support for the west. NAB’s Tapas Strickland wonders whether they’ll need to, with talks between Russia and Ukraine at least offering the opportunity “for an off-ramp” from the conflict. Oil prices have fallen today, mainly because of further lockdowns in China as the country continues to pursue a zero-COVID strategy. That’ll add to supply chain problems, which will further add to inflation pressures. No surprise then that bond yields have risen sharply ahead of the FOMC later this week. Hosted on Acast. See acast.com/privacy for more information.
14/03/2022 • 12 minutes 54 seconds
Getting close to the edge
Monday 14th March 2022Fighting got very close to the Polish border over the weekend, with Russian attacks on a training base. NAB’s Rodrigo Catril says it’s hard to see the volatility across all asset classes calming down as the uncertainty in Ukraine remains. Although talks are ongoing there has been little grounds for hope so far. This makes it all very tricky for the FOMC, whose members will be submitting their dot point predictions for future rate rises, in an environment where inflation is rising and consumer confidence is falling. Hosted on Acast. See acast.com/privacy for more information.
13/03/2022 • 15 minutes 23 seconds
ECB taper talk, while Lavrov tells-tales
10/03/2022 • 14 minutes 11 seconds
Risk on, but war still on too
Thursday 10th March 2021Looking at the markets this morning you might be mistaken for thinking Vladmir Putin had resigned, but sadly not. The war is still on, and just as messy as ever, but equities have risen, oil is down and bond yields are rising. NAB’s Gavin Friend talks us through this broad reversal in risk sentiment, which he says is being driven by a number of factors, but nothing concrete. There’s also discussion about the ECB meeting today, and the EU’ s plans to issue bonds to reduce dependency on Russian resources. Plus, did Philip Lowe’s speech yesterday indicate a rate rise from the RBA this year was more likely, or less? And US inflation numbers tonight. Hosted on Acast. See acast.com/privacy for more information.
09/03/2022 • 15 minutes 27 seconds
A glimmer of hope
08/03/2022 • 16 minutes 16 seconds
Day 12 brought more volatility, the search for safety
07/03/2022 • 15 minutes 18 seconds
Oil keeps increasing, Aussie rises above the confusion
06/03/2022 • 16 minutes 7 seconds
Powell, Putin and Prices
Friday4th March 2022The Aussie dollar was one of the winners today, even as the US dollar lurches to highs not seen since the early days of pandemic. It’s been driven by demand for coal and iron ore, as almost all commodities respond to the shock of supply cuts from Russia and Ukraine. Jerome Powell was back on Capitol Hill today, again reiterating the need to control rising inflation. Jobs continue to be part of the problem (with the ISM read overnight showing a fall in services employment) along with rising commodity prices. NAB’s Gavin Friend points to studies from the NY Fed, one noting that the global supply chain pressure index eased in February , a sign, he says, that global supply chains will repair. The question is, how quickly? The ISM numbers overnight didn’t show any improvement. Hosted on Acast. See acast.com/privacy for m
03/03/2022 • 16 minutes 15 seconds
Hiking away from the fighting
02/03/2022 • 16 minutes 36 seconds
Ukraine war ratchets up risk sentiment
01/03/2022 • 17 minutes 14 seconds
Moderate contagion, so far
28/02/2022 • 16 minutes 26 seconds
A swift response to the Ukrainian crisis
27/02/2022 • 16 minutes 6 seconds
Putting the Squeeze on Putin’s Squalid Venture
24/02/2022 • 17 minutes 3 seconds
23/02/2022 • 14 minutes 42 seconds
Biden's sanctions first step against Putin’s ‘invasion’
22/02/2022 • 15 minutes 43 seconds
Putin supports Donbass powder keg
Tuesday 22nd February 2022Will Putin’s declared support for separatists in the Donbass region be the false flag event the West has been concerned about? Does that mean an invasion is imminent? Market reaction hasn’t been strong so far, except for a rise in oil prices, but maybe that’ll change as the US returns from the President’s Day holiday. NAB’s Tapas Strickland says the actions overnight has certainly reversed the optimism yesterday, when a diplomatic solution looked more hopeful. Meanwhile, PMIs in Europe were really strong, which will add to the inflation pressures and could lead to a more hawkish ECB. US PMIs are out later on, and we’ll Christopher Kent from the RBA later today. What’s he going to say about QE and interest rates? Hosted on Acast. See acast.com/privacy for more information.
21/02/2022 • 14 minutes 9 seconds
More war talk adds to a storm of uncertainty
20/02/2022 • 15 minutes 5 seconds
Ball of confusion as Biden and Putin fight war of words
17/02/2022 • 14 minutes 14 seconds
Oil rising whilst Putin sits tight
16/02/2022 • 15 minutes 54 seconds
Risk-on as Putin backs-off (a bit)
15/02/2022 • 15 minutes 20 seconds
Putin on the brink, Fed ‘out of sync’
14/02/2022 • 16 minutes 25 seconds
War talk rocks markets, all eyes on the East
13/02/2022 • 15 minutes 42 seconds
High stakes, higher prices, bigger hikes?
10/02/2022 • 15 minutes 38 seconds
Bond sell-off on hold ahead of US inflation numbers
09/02/2022 • 13 minutes 57 seconds
China pushes back green agenda, UK heading for recession?
08/02/2022 • 14 minutes 47 seconds
Markets still guessing the path of inflation
07/02/2022 • 14 minutes 41 seconds
US kept working through Omicron peak
06/02/2022 • 15 minutes 22 seconds
Tight squeeze or a gentle touch?
Friday 4th February 2022The Bank of England is certainly all out to stop any risk of wages pushing inflation out of control. The decision was one vote away from a half percent rate rise, with NAB’s Gavin Friend saying the bank is trying to send a firm signal, even though the eventual number of rises this year might fall below current market expectations. The rise comes at a time of strong headwinds for UK households and the broader economy. Meanwhile, a strong reaction on bond markets to the ECB meeting. The announcement itself wasn’t a surprise, but some ground was given during the press conference suggesting the ECB might move faster than they have been letting on. Tonight, of course, non-farm payrolls. Before that, the RBA Statement of Monetary Policy. Hosted on Acast. See acast.com/privacy for more information.
03/02/2022 • 13 minutes 23 seconds
A tale of two central banks
Thursday 2rd February 2022You could say its the best of times and the worst of times, with a rampant jobs recovery tempered by high inflation. Certainly, two central banks have a different perspective on the underlying economic strength. As NAB’s David de Garis discusses on today’s podcast, the Bank of England are expected to raise rates today, whilst the ECB will continue to sit on its hands with Christine Lagarde, only yesterday, continuing to argue that inflation is temporary. Meanwhile, yesterday the RBA’s Philip Lowe finally admitted that a rate rise this year was plausible. Overnight we saw staggering earnings results from Google and disappointing jobs data in the US. Omicron almost certainly contributed to both of those outcomes. Hosted on Acast. See acast.com/privacy for more information.
02/02/2022 • 15 minutes 45 seconds
Markets still at odds with RBA and ECB. Who’s right?
Wednesday 2nd February 2022The RBA is still reticent to signal a rate rise this year, even as they lift their inflation forecasts. NAB’s Ivan Colhoun says a lot rests on what Governor Lowe has to say today. The ECB is also playing it cool, but with 2-year German Bund yields climbing higher than the loan rate its clear the markets don’t agree with them either. NAB’s Rodrigo Catril talks through the latest data from Europe and the US, and reasons why equities are so much calmer and why the Aussie dollar has bounced back today. Hosted on Acast. See acast.com/privacy for more information.
01/02/2022 • 15 minutes 49 seconds
RBA to join the rate-rise race?
Tuesday 1st February 2022It seems more likely than not that the RBA will announce an end to QEW today. NAB’s Tapas Strickland says core timed mean inflation is running two years ahead of the RBA’s forecasts which suggests a rate rise this year is also likely. The front end of the yield yield curve rose a little in the US after Raphael Bostic argued for a 50 basis point rate rise in March, although he retreated a little form those remarks today. Inflation is rising in Europe, with figures out just in time for the ECB this week, and the BoE will almost certainly raise rates too. So is inflation the only driver now? What if the rates push major economies into a downturn? Hosted on Acast. See acast.com/privacy for more information.
31/01/2022 • 15 minutes 43 seconds
Aussie dollar loses break point
Monday 31st January 2021Whilst it was quite a night for Rafael Nadal, Friday had a less positive ending for the Aussie dollar, falling below 70 US cents to its lowest level since mid-2020, despite rising commodity prices. NAB’s Ray Attrill says the sharp fall could be the result of portfolio rebalancing by Aussie investors, which means it could stay low today but recover after month-end. We’ll see. Meanwhile equities bounced back in the US on Friday but markets are still choppy. Wages grew slightly less than expected in the US in Q4 and consumption has slowed, which makes the path for interest hikes a little murkier. All eyes will be on the RBA tomorrow, with markets still expecting rate rises this year. Will the RBA join the group-think? And China takes a holiday this week, we look at the impact that could have on the Aussie dollar, as we welcome in the Year of the Tiger. Hosted on Acast. See <a style='color:grey;' target='_blank' rel
30/01/2022 • 16 minutes 4 seconds
The aftermath of the Fed
Friday 28th January 2022There has been quite a turnaround after the sharp falls in share prices and the rise in bond yields that we saw kicking off during the Jerome Powell press conference after the FOMC yesterday. Today, bond yields have been falling and shares attempted a climb back. So, given the Fed delivered exactly what was expected, why the strong market reaction. NAB’s Gavin Friend says markets were surprised by the hawkishness of the conference, but have perhaps since evaluated the vagueness of what was said. There was no timeline or detail on the number of rate hikes, for example. Today’s GDP numbers for Europe will provide evidence of the sharp contrast with the US, but that is expected to narrow as the year progresses. Hosted on Acast. See acast.com/privacy for more information.
27/01/2022 • 15 minutes 20 seconds
Fed confirms move to post-pandemic policy
Thursday 27th January 2022The FOMC has met and reaffirmed that rates will rise from March. NAB’s David de Garis says it was exactly what the markets were expecting, although the response has been a rise in yields and a fall in equities. Jerome Powell was more reticent to talk about the speed of tightening beyond the next meeting, given the uncertainties that remain. The Bank of Canada will also hike rates soon. Also on today’s podcast, what does the US widening trade deficit mean for their GDP numbers out later today, how will The RBNZ react to today’s inflation numbers, and Brent oil hits $90. Where to from here? Hosted on Acast. See acast.com/privacy for more information.
26/01/2022 • 15 minutes 54 seconds
Ukraine fears creates a risk off sell off
Tuesday 25th January 2022Markets have been gearing up for the FOMC meeting this week, but for a while at least tensions over Ukraine seem to have driven a strong risk-off push, with significant falls in share prices, a fall in bond yields and, to an extent, the US dollar seen as a safe-haven. But as the session progressed there was some re-evaluation of the risk, with shares and bond yields regaining some of the lost ground. As to the Fed, NAB’s Ray Attrill says the rising inflation is a major political headache for the Biden administration, so he’ll be eager to see the FDOMC do what it has to do to keep price sunder control. The question is, what will it do to the growth of the economy in the process? Hosted on Acast. See acast.com/privacy for more information.
24/01/2022 • 15 minutes 21 seconds
Turnaround in bonds ahead of FOMC this week
Monday 24th January 2022On today's podcast:Curiously bond yields retreated at the end of last week even though the assumption remains that the Fed will signal a March hike. NAB’s Tapas Strickland says the fall in yields is a response to the sharp sell-off in equities at the end of the week which is, itself, a response to the rising interest rate environment. Locally, the CPI numbers for Australia tomorrow will put the RBA’s timeline for rate rises into sharp focus. Global PMIs today might have less influence given they are influenced by transitory factors, such as lockdowns, and the focus on the Fed. Hosted on Acast. See acast.com/privacy for more information.
23/01/2022 • 14 minutes 58 seconds
Aussie jobs flourish and US equities bounce
Friday 21st January 2022Australia’s job numbers were well above expectations yesterday. NAB’s Ivan Colhoun talks about what this means for the RBA, who are still at odds with the market on their timetable for rate hikes. NAB’s David de Garis in London talks about the move up in equities and bond prices this session, suggesting it is likely to be nothing more than a bounce. The expectation is still that the Fed will end QE and move to rate hikes swiftly this year. It’s a less definitive picture in Europe, with the ECB minutes highlighting the divided opinions of the board. UK and Canadian retail numbers are out later today. Hosted on Acast. See acast.com/privacy for more information.
20/01/2022 • 16 minutes 17 seconds
Inflation (almost) everywhere
Thursday 20th January 2021The sell-off of US bonds has halted, temporarily, but it continues in Europe, particularly in the UK where high inflation numbers will heighten the Bank of England’s resolve to raise rates next month. Canada also reported a higher-than-expected level of CPI, increasing the expectation for a rate rise there next week. In Germany, 10-year bund yields moved into positive territory for the first time since 2019. As NAB’s Gavin Friend says, it’s not just a US dynamic, as central banks attempt to grapple with inflation. But what of Australia? Labour numbers today are expected to show the unemployment rate fall to 4.2%. Given many parts of the world are seeing wage-push inflation, could we see prices rise faster than anticipated? Hosted on Acast. See acast.com/privacy for more information.
19/01/2022 • 14 minutes 13 seconds
Markets swallow the post-Omicron outlook pill
Wednesday 19th January 2021US bond yields are now at their highest levels for two years, with equities now joining the sell-off, particularly for tech stocks on expectations of rising bank rates. NAB’s Rodrigo Catril says markets oil is also rising sharply on the expected rise in demand in a post-COVID area, or at least a time when we learn to live with the virus. The UK has shown how that can be done, with better-than-expected employment numbers, despite the rising number of cases in late 2021. So, how prepared is Australia to live with COVID? Today’s monthly consumer confidence numbers will give us an indication. Hosted on Acast. See acast.com/privacy for more information.
18/01/2022 • 14 minutes 51 seconds
China bucks the tightening trend
Tuesday 18th January 2022Bond yields continue to rise as expectations heighten for faster central bank tightening. As NAB’s Tapas Strickland discusses on today’s Morning Call, the exception is the People’s Bank of China, which lowered rates yesterday on concerns about the spread of Omicron. President Xi has asked other central banks to sit tight, but that seems unlikely. Even the RBA is likely to bring forward its end to QE to next month. Whilst China faces more lockdowns, the rest of the world seems to be opening up The UK seems likely to end its Plan-B restrictions as soon as next week. The Empire Fed Manufacturing survey will be worth looking out for today, particularly after a sharp fall in the ISM Manufacturing Prices Paid Index. Could the supply chain disruption be easing – and maybe inflation was transitory after all? Perhaps. Hosted on Acast. See <a style='color:grey;' target='_blank' rel='noopener noreferrer' href='https://aca
17/01/2022 • 15 minutes 2 seconds
Fed ready to fight inflation on two fronts
Monday 17th January 2022The Fed kicks of its schedule of FOMC meetings next week. We know tackling inflation will be front and centre, but as NAB’s Ray Attrill points out, rate hikes are not the only tool they will be using. The minutes from the last meeting also suggest reducing their balance sheet will be part of the plan. Meanwhile, we’ve seen a significant sell-off in bonds, as investors expect a strong economic recovery this year, as Omicron’s impact wanes. Except in China, of course, which continues to pursue a zero-COVID policy, meaning supply chain disruption could remain, adding to inflation. China’s Q4 GDP is the data to look out for today. Hosted on Acast. See acast.com/privacy for more information.
16/01/2022 • 16 minutes 36 seconds
Looking ahead to a better 2022
Wednesday 22nd December 2021There was a lot more positive sentiment in the markets overnight. NAB’s Rodrigo Catril says it’s all down to Omicron news, with infection rates falling in South Africa and hopes that a pill can stave off the worst for people who catch it. If the news remains as positive as all that, how will markets fare in 2022? How quickly will China bounce back, given their zero-COVID policy will still force shutdowns? What will happen to inflation is consumer demand improves but supply chain bottlenecks remain? What actions will central banks take and will any step too far when it comes to balance sheet reductions? And what will happen with the Great Resignation, if there continue to be many more jobs than people to fill them? One thing we can be certain of, even if COVID dies down next year, uncertainty remains. Hosted on Acast. See <a style='color:grey;' target='_blank' rel='noopener noreferrer' href='https://acast.com
21/12/2021 • 17 minutes 37 seconds
Europe’s cold cold Christmas
Tuesday 21st December 2021Energy markets are dominating market moves in the run up to Christmas. Oil prices have fallen significantly on fears that travel demand will fall as Omicron gains strength, whilst gas prices in Europe continue to rise on supply constraints from Russia. Equiites have also been hit hard by the virus uncertainty, on thinner holiday trading. NAB’s Ray Attrill says US numbers are just a couple of weeks behind the UK. And geopolitics is also at play, particularly in Chile and Turkey. Even in the UK Boris Johnson can’t be assured he won’t make it through Christmas without a roasting from his backbenchers. Hosted on Acast. See acast.com/privacy for more information.
20/12/2021 • 13 minutes 43 seconds
A very cautious Christmas
Monday 20th December 2021Markets are very cautious ahead of the Christmas break, with concerns about the impact of the Omicron strain. The Netherlands has gone into another lockdown and restrictions are being introduced in many other parts of Europe. But that’s not stopping a more hawkish attitude from the FOMC. NAB’s Tapas Strickland says a March hike in the US is a real possibility, with Fed Governor Waller flagging concerns about an “alarmingly high” inflation rate. More discontinuity in supply chains from Omicron could add to inflation concerns, of course. Today, we also discuss rate hikes whilst winding down balance sheets. Could central banks go too far too quickly? Hosted on Acast. See acast.com/privacy for more information.
19/12/2021 • 13 minutes 54 seconds
BoE lifts rates despite everything
Friday 17th December 2021A rate rise by the Bank of England has surprised many, particularly in an environment of record COVID infections, and a hospitality industry calling for government support as pre-Christmas demand collapses. NAB’s Gavin Friend says it had been clear since August that they wanted to lift rates, the only reason for the delay was a question mark over whether employment numbers would fall after furlough ended, which it didn’t. The ECB gave clearer indications of how they would manage their asset purchase post March. The RBA’s Philip Lowe remains cautionary despite an outstanding set of employment numbers for Australia yesterday. In data releases, PMIs showed a significant fall in services for Europe that is not being seen in the US. A pick-up in housing starts I the US could be taken as a sign that supply chain concerns are easing. Hosted on Acast. See <a style='color:grey;' target='_blank' rel='noopener noreferrer'
16/12/2021 • 16 minutes 17 seconds
Fed’s turbo taper and dots surprise
Thursday 16th December 2021The Fed, not surprisingly, are tapering faster as the race is on to lift rates next year. NAB’s David de Garis says the QE ending by March clears the decks, with a revised inflation forecast speeding up the expectations of rises. Markets were expecting a hawkish tilt, so they haven’t been surprised. The Bank of England decision is less easy to read later on, with Britain’s high inflation number overnight offset by the highest number of daily COVID infections since the pandemic began. The ECB follows shortly after that, in a busy day which also sees PMIs across the globe and Aussie employment numbers. Hosted on Acast. See acast.com/privacy for more information.
15/12/2021 • 16 minutes 10 seconds
It’s all about dots and jabs
Wednesday 15th December 2021Markets are still pulled in two directions. First there’s the continued uncertainty of the new COVID variant, which might be mild (or not), but is spreading like wildfire in the UK right now and the race is on to have booster jabs across the globe. Then there’s the inflation question and how quickly central banks will respond to it. A sharp increase in producer prices in the US has added to the ammunition for the Fed to move faster, with the next FOMC meeting tomorrow. It is assumed QE will end in March, the question is how many dot points for rate rises are expected next year. Whilst the Fed might predict two, markets are pricing for three. NAB’s Rodrigo Catril says if the FOMC suggests three, the markets might move their expectations to four. It seems whatever the Fed chooses, markets expect more! Hosted on Acast. See <a style='color:grey;' target='_blank' rel='noopener noreferrer' href='https://acast.com/
14/12/2021 • 15 minutes 5 seconds
A little more caution on a lot less news
Tuesday 14th December 2021There’s a little more caution this morning, with equities down, driven by banks, travel and energy, with stay at home stocks doing better. But NAB’s Tapas Strickland points out, the fall in the S&P is on the back of the 67th record high of 2021 on Friday night. He says we shouldn’t expect too many significant moves ahead of the FOMC, ECB and Bank of England later in the week, and little significant news expected before then. Turkey’s central bank has already met, responding to sky high inflation by lowering interest rates. An interesting approach. Whilst rising Omicron cases are adding to the cautious tone. Numbers in the UK have risen sharply again, with the first recorded fatality. Hosted on Acast. See acast.com/privacy for more information.
13/12/2021 • 12 minutes 4 seconds
UK empties the glass, but markets still half full
Monday 13th December 2021Markets were trading last week on the basis that the Omicron variant was not as lethal as the Delta strain, even though infections were spreading rapidly. NAB’s Ray Attrill says that’s been the view with central banks too, who are more concerned about inflation than and further impacts from COVID. That said, rising cases in the UK will almost certainly stop the Bank of England from raising rates this week, whilst the FOMC is expected to shorten its taper timeline, finishing in March. It’s a busy week for central banks and more data on Omicron will influence the direction too. Starting with a press conference from the UK’s Prime Minister (for now) shortly after the release of this podcast. Hosted on Acast. See acast.com/privacy for more information.
12/12/2021 • 15 minutes 47 seconds
Transmission and inflation - the two concerns
Friday 10th December 2021Things were definitely a bit quieter overnight, with markets stepping back a little as they wait to figure out just what impact Omicron is having, and which way inflation is heading. We get the latest indication on the latter with US CPI number out tonight, but NAB’s Ray Attrill says China’s consistently high producer prices don’t bode well. Also today, how China is trying to stop the appreciation in the Yuan and what to expect from the UK’s GDP number tonight. Hosted on Acast. See acast.com/privacy for more information.
09/12/2021 • 14 minutes 53 seconds
Banks to sit on their hands, UK to cover their faces
Thursday 9th December 2021Even though equity markets have slowed, bond markets are still reflecting positive sentiment around coping with the Omicron strain. NAB’s Gavin Friend says Pfizer has confirmed views that three jabs will guard against serious illness from the new variant, and yet just now the British Prime Minister, where almost a third of the population have had three jabs, has introduced tougher measures to control the spread, including mask wearing at almost all indoor venues, working from home and vaccine passports for larger venues. The Bank of Canada has delayed acting on rising inflation and it seems likely that all central banks will sit on their hands this side of Christmas until more is known about the impacts of Omicron. Yesterday the RBA’s Philip Lowe said he didn’t expect the new strain to delay the recovery, but what makes him think Australia is so unique? Hosted on Acast. See <a style='color:grey;' target='_blan
08/12/2021 • 17 minutes 56 seconds
Omicron’s not so bad, markets hope
Wednesday 8th December 2021There’s a lot of positive sentiment around this morning. Equities are rising sharply in the US and Europe, oil is up and bond yields are rising. NAB’s Gavin Friend says it’s been driven by the efficacy numbers of a GlaxoSmithKline vaccine, and circumstantial evidence that the Omicron strain might not be that bad for those who have been jabbed. Data wise there were fairly in strong industrial production numbers in Germany, with Chinese imports picking up and the final GDP numbers showing a rise in European consumer spending. In other news, Janet Yellen has been channelling her inner Donald Trump when it comes to tariffs and tensions brew over Ukraine. And NAB’s Ivan Colhoun deciphers yesterday’s RBA meeting. Hosted on Acast. See acast.com/privacy for more information.
07/12/2021 • 14 minutes 55 seconds
China and Omicron hopes drive a bounce back
Tuesday 7th December 2021US equites are roaring back, so is oil, with bond yields rising again. This newfound optimism has been driven by policy easing measures from China’s central bank, and less concern about the impact of the Omicron strain. It’s still too early to draw definitive conclusions on the virus, says NAB’s Rodrigo Catril, with reports from South Africa that there is a concerning rise in younger patients. Tougher measures on mandatory vaccines for workers could also ignite more protests that could have the opposite impact on take-ups, which could slow economies, particularly in Europe. Not much is expected from the RBA today, but the build-up of positive data is likely to force a policy change in February. Meanwhile, the jury is still out on the Bank of England next week, but market expectations around a rate rise are falling. Hosted on Acast. See <a style='color:grey;' target='_blank' rel='noopener noreferrer' href='https
06/12/2021 • 14 minutes 57 seconds
Too tight too quickly?
Monday 6th December 2021Markets were far more cautious on Friday. In part there are still concerns about the new Omicron strain, although circumstantial evidence so far is pointing to it being a milder variant. NAB’s Tapas Strickland says tech stocks were hit the hardest, because there’s growing acceptance that the Fed will push ahead with faster tapering, irrespective of tailwinds. Payrolls numbers were weaker than anticipated, but not enough to stop them, it seems. That raises the question, will central banks push ahead with tightening measures before economies have recovered to the detriment of the longer term outlook? Hosted on Acast. See acast.com/privacy for more information.
05/12/2021 • 14 minutes 17 seconds
There’s a certain uncertainty
Friday 3rd December 2021Markets have displayed much mor epositive sentiment in the last 24 hours, but its not lasting. Gains in US equities have fallen away a little, and oil prices have risen sharply and fallen back again. NAB’s Tapas Strickland says Omicron news is mixed – it’s certainly spreading quickly but symptoms of those who are vaccinated appear to be mild. US Treasury yields have flattened further as more Fed officials pile on with calls for faster tapering. Oil prices fell sharply mid-session on the news that OPEC would lift supplies next month, but rose again on the news that they would pull back if demand falls because of Omicron. In short, another day of uncertainty all round. Hosted on Acast. See acast.com/privacy for more information.
02/12/2021 • 14 minutes 37 seconds
WHO offers a shot in the arm for markets
Thursday 2nd December 2021Markets were choppy again overnight, but there is renewed hope with circumstantial evidence that the Omicron variant might be less severe. A WHO press conference suggested that existing vaccines will be enough to prevent many extreme cases, but we’ll still have to wait for the final verdict. NAB’s David de Garis says that was enough for the focus to shift a little to positive data reads out of the US, including a 534k rise in the ADP payrolls number an ISM manufacturing at 61.1 for November. Australia’s better than expected Q3 GDP number has done little to help the Aussie dollar – Dave suggests it has followed the fortunes of the S&P500. Today, the focus will stay with news around the virus and its impact on lockdowns and other contingency measures. Hosted on Acast. See acast.com/privacy for more information.<
01/12/2021 • 14 minutes 3 seconds
Who are you and what have you done with Jerome Powell?
Wednesday 1st December 2021You might have expected that Jerome Powell would use the uncertainty of the new COVID strain to downplay the need to adjust the speed of tapering by the Federal Reserve, but instead, addressing the Congress, he talked up the need for faster tapering, to be discussed at the next FOMC meeting. So, what’s brought about this character transformation? NAB’s David de Garis says he is clearly now far more worried about inflation. The ECB, meanwhile, is happy to keep using the transitory word and believes inflation has just about peaked. Meanwhile, China’s PMIs and prices paid gave a glint of hope that supply chain issues might be easing, albeit very slowly. But progress could be destroyed by the impact of measures to constrain the new variant. The future is as clear as mud and markets today reflect that uncertainty. Hosted on Acast. See <a style='color:grey;' target='_blank' rel='noopener noreferrer' href='https://a
30/11/2021 • 14 minutes 44 seconds
The bounce, the restrictions, the uncertainty
Tuesday 30th November 2021On today’s Morning Call NAB’s Ray Attrill reminds us that the CSIRO’s Dr Rob Grenfell predicted, back in the middle of the year, that about now we would see a variant of COVID spreading from India or Africa. He now says the situation in South Africa is not a good comparator for Australia, and we should watch how it develops in Europe over the next couple of weeks. In the meantime, markets are playing a waiting game. There was a mild bounce back in equities, bond yields and the US dollar, but volatility will remain, driven by the news cycle. The other unknown is the impact this will have on the speed of a global recovery, with border shutdowns and the like, and the subsequent impact on inflation. Lots of questions for Jerome Powell and Janet Yellen then, in front of a senate hearing today. China’s PMIs will be the numbers to watch today. Hosted on Acast. See <a style='color:grey;' target='_blank' rel='noopener
29/11/2021 • 14 minutes 12 seconds
Did the markets overreact to Omicron news?
Monday 29th November 2021There was a very strong market response to the news of the Omicron virus strain on Friday. Equities were hit hard, currencies ran for the shelter of safe havens and there was a sharp fall in bond yields. How much of this was a knee-jerk reaction amongst the thin trading on the day after Thanksgiving. NAB’s Rodrigo Catril says we can expect Asian markets to follow the US today, before markets settle down, but we can expect volatility for some time as we wait for news that helps assess the risk posed by this new strain. So, what does this mean for central bank tightening? Where will the Aussie dollar head through this turbulent time? What impact will it have on oil and inflation? Hosted on Acast. See acast.com/privacy for more information.
28/11/2021 • 15 minutes 32 seconds
Talking turkey on central bank thinking
Friday 26th November 2021As America gobbles up Turkeys NAB’s Gavi Friend talks through the latest positioning on tightening by central banks. The FOMC minutes suggested a more hawkish approach, and the latest data would suggest that view has been reinforced, but there’s still a disconnect between what the markets expect and the messaging from the Fed. The Riksbank has started to talk about rate rises, but not before 2024. The Bank of England looked certainly to raise rates last month, but it didn’t happen and a rise in December is now looking less certainly. The ECB are continuing down a dovish path, reinforced by their latest minutes overnight. Meanwhile, the RBA is holding firm, even though the bounce back in jobs yesterday (with retail sales data today) suggests a recovery that most nations would be envious off. Hosted on Acast. See aca
25/11/2021 • 14 minutes 34 seconds
Is the US getting too hot to handle?
Thursday 25th November 2021There were many more positive signs for the US economy overnight, with initial jobless claims at an all-time low. The US dollar remains in favour, with the DXY index reaching a 16-month high. On today’s podcast NAB’s Tapas Strickland says rising inflation concerns are turning even the most dovish FOMC members, with Mary Daly the latest calling for a faster taper to make room for rate rises. Former US Treasury Secretary Larry Summer spoke again about his concerns about the Fed’s delay, worried that they won’t be able to find “a soft landing”. Meanwhile, the Kiwi dollar has been hit hard by the quarter percent rate rise by the RBNZ. Why was there such a sharp response? Plus, the latest on oil, with prices down today, but we can expect more volatility as OPEC takes on their customers. How dare they dip into reserves! Hosted on Acast. See <a style='color:grey;' target='_blank' rel='noopener noreferrer' href='http
24/11/2021 • 14 minutes 56 seconds
Happy tales from Euroland
Wednesday 24th November 2021There was a surprise for those expecting the PMI numbers on Tuesday to confirm the widening gap between US and European economic performance. Let’s be honest, the NAB Morning Call team were amongst those who weren’t expecting to see the narrowing of the divide, with Europe doing somewhat better than expected, and the US a little worse than forecast. But NAB’s David de Garis says the US bond yields are still up, the market still wants to hold US dollars in anticipation of a quickening of the taper and earlier rate rises. The RBNZ rate decision today will be watched closely – there’s still an outside chance the rise will be as much as half a percent. And Joe Biden’s attempts to bring down the cost of oil seems to have gone awry. Confirmation of a plan to dig into reserves, not just in the US, has seen oil prices shoot skywards. Hosted on Acast. See <a style='color:grey;' target='_blank' rel='noopener noreferre
23/11/2021 • 14 minutes 22 seconds
US dollar rises as Powell stays put.
Tuesday 23rd November 2021The US dollar and bond yields rose on the news that Jerome Powell is to keep the top job at the Fed for another term, with Lael Brainard as deputy. Even though both are doves, NAB’s Ray Attrill says the market still has two or three rate rises priced in for next year. The Aussie dollar has avoided collateral damage from the raising US dollar, helped by the news of border reopenings, that will help foreign workers to return. Today is PMI day, which is expected to give a further clear delineation between the strength of thew US economy versus the woes faced in Europe. The Euro is expected to continue to bear the brunt of any rises in the dollar. Hosted on Acast. See acast.com/privacy for more information.
22/11/2021 • 15 minutes 22 seconds
A speedy taper and European tantrums
Monday 22nd November 2021The divide between the US and Europe became more pronounced at the end of last week, as NAB’s Rodrigo Catril explains 0n today’s Morning Call. On the one side of the Atlantic there are increasing infections, more lockdowns and, in Austria, mandatory vaccines, with a central bank pushing the line that tightening will only damage the recovery. On the other side, central bankers are talking up the need for faster tapering, presumably so they can move to raise rates sooner. But hardly anyone is moving as fast as New Zealand, with the RBNZ certain to lift rates this week, but by how much? Hosted on Acast. See acast.com/privacy for more information.
21/11/2021 • 13 minutes 50 seconds
US continues a slow recovery, Europe’s mounting issues
Friday 19th November 2021US equities have bounced back a little today, but, as NAB’s Gavi Friend describes, it’s been a session without significant event risk or data flow. Equities and bond yields have been stable compared to recent volatility, with the tech sector contributing to equity rises, including news of Apple’s self-drive car. Some companies are also reporting easing of supply chain difficulties. Those issues have certainly been holding back the speed of recovery, evidenced again by higher prices in the Philly Fed’s manufacturing index and a slowdown in the reduction of weekly jobless claims. If supply chains recover and jobs growth picks up, will inflation subside. That continues to be the view of the ECB, with Philip Lane reiterating it again overnight. Europe meanwhile has other issues to contend with – energy supplies, rising COVID cases and a likely trade dispute with the UK. Hosted on Acast. See <a style='color:grey;' t
18/11/2021 • 14 minutes 40 seconds
Caution after UK inflation surprise. Will Aussie wages ratchet up?
Thursday 18th November 2021Australian wage growth is in line with expectations, but where to from here? Phil Dobbie asks NAB’s Ivan Colhoun if there’s a chance we’ll see wages escalate in the next few months? The UK’s inflation numbers surprised everyone overnight, reaching 4.2 percent year on year. Does this concrete in a BoE rate rise, or could they do what they did last time and do nothing? David de Garis gives his thoughts. Canada’s inflation is also increasing, but no more than anticipated. US housing starts are down, but there are clear signs they’ll soon pick up. Join us for a Morning Call triple header! Hosted on Acast. See acast.com/privacy for more information.
17/11/2021 • 14 minutes 38 seconds
Tills ring in the USA, jobs bounce back in the UK
Wednesday 17th November 2021It’s been a positive session overnight, with US retail sales rising and US jobs bouncing back. NAB’s Tapas Strickland says it’s difficult to tell how much of the 1.7% month on month increase in sales is a result of rising prices and how much is more goods sold, but it shows consumers are prepared to spend even with supply constraints and inflation concerns. The UK jobs numbers are particulartly good because they have grown despite the end of a job furlough scheme with 1.1 million people on it. Mostly retained their jobs and there were many extra jobs besides. Is this the ammunition the Bank of England needs for a rate rise next month? Meanwhile Governor Lowe continues to be cautious about rate hikes for Australia, reiterating nothing is likely to happen until 2024, even though the market has priced in 2022. Hosted on Acast. See <a style='color:grey;' target='_blank' rel='noopener noreferrer' href='https://ac
16/11/2021 • 14 minutes 25 seconds
Europe’s caution, China’s hope
Tuesday 16th November 2021The Euro has lost ground this morning, with concerns over COVID, following lockdowns in Holland and Austria, and rising cases in Germany. There remains a very different attitude between the ECB and the Fed, with Christine Lagarde reiterating that in Europe they are in no rush to tighten policy. China’s activity data provided hope that the country’s economy was stabilising. In the US there will be a lot of focus to see whether tonight’s retail numbers are strong, or will they have been pulled down with falling consumer sentiment? The UK’s employment numbers will be watched keenly by the Bank of England, but NAB’s Rodrigo Catril says it’s too soon to provide the full picture needed to determine rate rises. And President Xi and President Biden meet (virtually) shortly – the start of better relations, perhaps? Hosted on Acast. See <a style='color:grey;' target='_blank' rel='noopener noreferrer' href='https://acast
15/11/2021 • 14 minutes 25 seconds
US facing higher prices, more quits, falling sentiment
Friday 15th November 2021Hot on the heels of the surprising increase in inflation in the US earlier last week, Friday saw an unexpected fall in consumer sentiment. The Michigan survey hit an 11-year low. NAB’s Ray Attrill says previous low readings had been associated with rising COVID cases, but now, as the US seems to be faring somewhat better than Europe, the concern is all about rising prices. It’s a significant issue for the Fed and the US government, with wages rising significantly below the headline inflation rate. To counter being worse off, over 4 million Americans quit their job in one month. In Europe COVID itself remains a concern with restrictions re-imposed in Holland and Austria. Could other countries follow as winter draws near? Today, activity data from China will be keenly watched, and later in the week the wage price index will highlight whether Australia too could become subject to wage-push inflation. Hosted on Aca
14/11/2021 • 14 minutes 47 seconds
Have a little faith
Friday 12th November 2021Markets have been a little more positive over the last 24 hours, with the NASDAQ back on the rise, although a rising US dollar continues to hurt the S&P, and the Aussie dollar has taken another hit. Part of the fall in the Aussie can be attributed to the weaker than expected jobs numbers yesterday, but NAB’s David de Garis says when you unpack the numbers there was plenty of ground for optimism. He says one interesting factor has been the gross rise in jobs in NSW – many people were switching jobs as the lockdown eased. Australia could be witnessing the start of the great resignation seen in other developed countries. The UK’s recovery slowed, with GDP lower than expected, but that’s been offset by falling COVID cases and high uptakes of the third jab. So, what does that all mean for the expectation of rate rises form the Bank of England? Hosted on Acast. See <a style='color:grey;' target='_blank' rel='noopener
11/11/2021 • 12 minutes 54 seconds
Eye-popping inflation doesn’t faze the Fed
Thursday 11th November 2021The inflation numbers from the US have been eye popping. That’s the description by the Fed’s Mary Daly as US CPI hits 6.2%, a 30 year high. NAB’s Gavin Friend points out that there are still four million people in the US who lost their jobs through COVID who aren’t back in the workforce, and the Fed will continue to use that reasoning for not lifting rates. But markets are likely to revert to their expectations that the bank will be forced to move sooner than it intends. Australia’s labour market data today, for October, will still be held back by lockdowns and the UK’s GDP read for Q3 will provide a useful barometer on an economy whose return is slower than anticipated, and will have taken a knock with increased fuel costs. Hosted on Acast. See acast.com/privacy for more information.
10/11/2021 • 14 minutes 49 seconds
Markets out of steam on inflation day
Wednesday 10th November 2021There’s been a move away from risk assets. It could just be equity markets running out of steam after a particularly strong rally, but a Financial Stability Report from the fed warning of “perilous lunges for risky assets” probably didn’t help. NAB’s Ray Attrill says it’s hard to join all the dots right now about why the mood has shifted, but inflation continues to be a concern. It was reflected in the NFIB small business report, along with difficulties in obtaining staff. There’s optimism in Australia though, evidenced by the NAB Business Survey yesterday. Today, US CPI will be the focus, along with producer prices from China. Two key numbers for inflation watchers. Hosted on Acast. See acast.com/privacy for more information.
09/11/2021 • 14 minutes 30 seconds
Taking a breather
Tuesday 9th November 2021You’d think markets would be bathed in positivity, particularly in the US, with a string of good news, including infrastructure spending, the COVID pill and the reopening of a lot of international travel. There’s evidence of tiredness in the equity market says NAB’s Rodrigo Catril in today’s podcast, but we’ve been here before and then it takes off again. Bond yields meanwhile are still adjusting to a world in which central banks are not quite so quick to raise rates, whilst coping with a high inflation outlook. On top of all that, Europe has to contend with higher gas prices, rising again, and the danger of a trade war over Brexit. Locally, the NAB business survey is out early this morning (7.30am). Hosted on Acast. See acast.com/privacy for more information.
08/11/2021 • 14 minutes 52 seconds
Bond markets wrapped up in a ball of confusion
Monday 8th November 2021You might expect a little more optimism in the markets given Friday’s strong non-farm payrolls data in the US, Pfizer’s news about a pill for COVID sufferers, the passing of Biden’s $1.2 billion infrastructure bill and rising consumer credit in the US. Equity markets are riding high on future hopes, but NAB’s Tapas Strickland says bond markets continue to unwind from expectations on the timing of rate hikes by central banks, in particular the surprise move by the Bank of England last week not to move. Today we also look at Friday’s RBA Statement of Monetary Policy, and look ahead to US CPI and Australian labour market data this week. Hosted on Acast. See acast.com/privacy for more information.
07/11/2021 • 15 minutes 31 seconds
Bank of England Backs Down
Friday 5th November 2021There has been a sharp response in bond yields and currency markets to the Bank of England’s decision not to lift interest rates. Furthermore, Andrew Bailey is suggesting he doesn’t know where everyone got the idea that they would. NAB’s Gavin Friend says the response has been very marked. The fall in yields is pushing riskier assets, hence new highs for the S&P and NASDAQ. Yields could claw back a little as markets assess the possibility of a December hike. Meanwhile, the focus is on tonight’s non-farm payrolls in the US, with indications that it could be a strong number. Hosted on Acast. See acast.com/privacy for more information.
04/11/2021 • 14 minutes 3 seconds
Tighter but taking time
Thursday 4th November 2021There weren’t any surprises in from the FOMC this morning. The Fed will cut asset purchases by $15 billion this month, with a further $15 billion in December, and an expectation that it will continue until the middle of next year. But Jerome Powell was again quick to point out that the tapering does not imply “any direct signal on interest rate policy”. Phil Dobbie talks to NAB’s David de Garis about the meeting, and looks at the latest US data that shows further signs of recovery. Tonight all eyes are on the Bank of England, where we can expect a small move up in interest rates. They’ve practically said as much. Hosted on Acast. See acast.com/privacy for more information.
03/11/2021 • 15 minutes 18 seconds
Central banks still grappling with what to do about inflation
Wednesday 3rd November 2021Central banks are still grappling with what to do about inflation. The RBA is reluctant to talk about interest rate hikes anytime soon, because they don’t think inflation will be a big problem. The Fed and the Bank of England take a different view, but how hawkish will they be. Today on the Morning Call NAB’s Tapas Strickland looks back at yesterday’s RBA meeting and looks ahead to the FOMC tomorrow morning, whilst discussing the various attitudes to the dimensions of inflation. Concerns over supply chain disruptions, of won’t be helped by the rise of COVID lockdowns in China , with the Commerce department there asking local authorities to stock up for winter. Hosted on Acast. See acast.com/privacy for more information.
02/11/2021 • 15 minutes 32 seconds
RBA more uncertain than the cup winner
Tuesday 2nd November 2021For once we are going into an RBA meeting unsure of what the outcome will be. NAB’s Ray Attrill says we have as much chance of predicting a winner in the Cup today as we do forecasting what direction the central bank will take. Meanwhile bond yields in Europe are being driven by the next central bank meeting – will the ECB abandon its PEPP program? Plus, more evidence of the great China slowdown. Hosted on Acast. See acast.com/privacy for more information.
01/11/2021 • 15 minutes 12 seconds
The winds of change in central bank policy
Monday 1st November 2021There were more big moves in Australian bond yields on Friday as the RBA failed to buy up the April 2024 bonds that were the focus of its yield curve control (YCC) policy. So does that mean YCC is dead? NAB’s Rodrigo Catril says, yes it is. It has become dysfunctional, given the force we have seen from markets pushing front end yields higher around the globe. It should make for an interesting RBA meeting tomorrow, with more to come from the Bank of England the Fed. All are expected to confirm a policy shift. Meanwhile, evidence of inflationary pressures continue to mount, whilst China’s manufacturing is in contraction. Listen in as Rodrigo explains the rapidly evolving picture, for bonds, economic growth, jobs and inflation. Hosted on Acast. See acast.com/privacy for more information.
Friday 29th October 2021Three year bond yields rose well above the RBA’s target of 0.1 percent yesterday, but the central bank didn’t buy any up as part of its yield control. That pushed yields even higher. So will they react today? NAB’s David de Garis doesn’t think the bank will ditch yield control, but it’ll make next week’s policy meeting that much more interesting. Christine Lagarde said there was a lot of soul searching at yesterday’s ECB meeting, where the discussion was all about "inflation, inflation, inflation". In the end they reaffirmed that inflation was a transitory issue and there was no need for the bank to react. Yet Germany and Spain reported the highest inflation rates in decades. Are they doing the right thing? Meanwhile, equites are existing in a different world, rising still higher on the back of strong earnings results. And Facebook is changing its name. Listen in for more details. Hosted on Acast. See <a style='
28/10/2021 • 14 minutes 38 seconds
Going bond crazy
Thursday 28th October 2021There have been sharp movements in bond yields, with front end yields rising and falls at the back end. NAB’s Gavin Friend says it reflects expectations that rising inflation will force central banks to raise rates sooner. We saw a higher-than-expected rise in Australian inflation yesterday and 2 year yields rose sharply overnight. Guy Debelle is in front of senate estimates this morning – will he still be arguing the transitory line? Bonds were also impacted by the Bank of Canada, who were more hawkish than expected, and by Rishi Sunak’s UK budget, which included forecasts suggesting a £50 billion drop in debt issuance next year. Tonight, the ECB meets and Q3 US GDP numbers are released. Hosted on Acast. See acast.com/privacy for more information.
27/10/2021 • 13 minutes 47 seconds
Summers’ Twitter Tirade as US inflation expectations hit 13 year high
Wednesday 27th October 2021Former US Treasury Secretary Larry Summers took to Twitter yesterday to challenge Janet Yellen over inflation policy, suggesting the risk of losing control of it is higher than at any time in his career. Today, NAB’s Rodrigo Catril talks more about the rising inflation sentiment, with inflation expectations in the US now at a 13 year high. The expectation of a rate hike is being brought forward around the world, but the RBA (and NAB) are not expecting that to happen in Australia. Will this morning’s CPI numbers change that view? Hosted on Acast. See acast.com/privacy for more information.
26/10/2021 • 14 minutes 8 seconds
Banks ready to tighten, Biden ready to spend
Tuesday 26th October 2021The markets continue to be dominated by rising inflation concerns, including the price of oil. WTI got over $85 today, but has fallen back since. NAB’s Tapas Strickland tells how Saudi Prince Abdulaziz bin Salman has said it’s too early to up production whilst uncertainty prevails. There was an example of that uncertainty as another Chinese province went into lockdown. But equity markets aren’t concerned about such things. The S&P500 hit a new high as share rose on the back of strong earnings and higher commodity prices. And Joe Biden could be a step closer to having a scaled back version of his infrastructure package see the light of day. Listen in to find out why. Hosted on Acast. See acast.com/privacy for more information.
25/10/2021 • 13 minutes 22 seconds
Powell wants time to heal
Monday 25th October 2021Comments from Jerome Powell added to the volatility in bond markets on Friday. The chair of the Fed reinforced that it was time to taper, but suggested rate rises would have to wait, with more than five million people who were working before the pandemic still unemployed. The labour market needs time to heal, he said. NAB’s Ray Attrill says it shows that he is less inclined to respond to inflation worries until bond purchases are unwound, unlike the Bank of England. Ray also points out how the PMI data for Europe, the UK and US was generally strong, suggesting that stagflation looks like likely. It’s a busy week ahead with the ECB and Bank of Canada meeting, Q3 CPI for Australia and lots of earnings announcements, including Facebook after Monday’s close in the US. Hosted on Acast. See acast.com/privacy for more
24/10/2021 • 15 minutes 10 seconds
Commodities down, but inflation fears stay high
A sharp fall in commodity prices hasn’t dampening inflation expectations, and with it the assumption that central banks will bring interest rates forward. NAB’s David de Garis says it’s been a day when bond markets in particular have particularly been bitten the inflation bug, with pricing suggesting inflation will average three percent over the next five years, even higher in the UK. Two surveys highlighted that supply chain difficulties continue, the Philly Fed’s Business Outlook, and the CBI Optimism Index. The CBI survey showed that two thirds of UK businesses were complaining of supply shortages, the last time it was that high was in January 1975. Oh dear. Hosted on Acast. See acast.com/privacy for more information.
21/10/2021 • 14 minutes 8 seconds
The inflation debate heats up
Thursday 21st October 2021Equities are rising to new highs as risk sentiment improves on the back of strong earnings results in the US, even though inflation remains an ever-present concern. NAB’s David de Garis says the Fed’s Beige Book, out this morning, highlights how many companies are convinced they can pass on their increased costs, with consumers paying through increased wages. If that’s the case has Jerome Powell been right all along, that inflation is transitory? It remains the subject of intense debate. The head of the Bundesbank has announced his resignation, citing personal reasons, but could it also be his objection to ECB’s delay in tackling inflation? And could the Bank of England’s plans by stymied as COVID infection rates start to rise again, quite significantly. Hosted on Acast. See acast.com/privacy for more informat
20/10/2021 • 14 minutes 3 seconds
Earnings anything but a damp squid
Wednesday 20th October 2021US equities have had a strong session, although Procter and Gamble weas one of the first major household companies to highlight margin squeeze from supply chain difficulties. Netflix earnings are expected to be strong thanks in part to the success Squid Game. Meanwhile the tentacles of inflation continue to worry policy makers almost the world over – the RBA being one of the few exceptions. The UK CPI numbers are out tonight, but already it seems like a rate rise is (squid) inked in. Phil Dobbie asks NAB’s Ray Attrill whether the Bank of England could regret lifting rates, and whether the lack of movement in longer-dated bond yields suggests investors are thinking the same thing. Hosted on Acast. See acast.com/privacy for more information.
19/10/2021 • 15 minutes 3 seconds
Inflation and slowing economies. Isn’t there a word for that?
Tuesday 19th October 2021Bond yields are higher globally as inflation concerns mount. New Zealand’s CPI read (2.2% QoQ) sent 10 year yields up 16 basis points, spilling over to Australia. But NAB’s Rodrigo Catril says the inflationary pressures haven’t yet arrived in Australia which means the RBA will lag other central banks when it comes to rate hikes. Meanwhile, China is showing signs of a significant slowdown in output, with GDP growing just 0.2 percent in the last quarter, and with supply chain disruption, COVID lockdowns and energy shortages unlikely to improve that number could go lower. US data also disappointed. Phil Dobbie asks whether these are the signs of emerging stagflation? Or will corporate earnings give the markets some momentum and show there is growth, even with rising prices? Hosted on Acast. See acast.com/privacy f
Monday 18th October 2021Equity markets were buoyed by strong US earnings results and stronger than expected retail sales numbers, but there are many reasons to suggest this confidence might be short-lived, according to NAB’s Tapas Strickland. Corporate earnings have been focused on the finance sector, so results from other sectors will give an indication of the inflation impacts on margins and growth potential. Chinese activity data today and the ongoing Evergrande saga could impact global growth hopes. Then there’s inflation, which continues to grow, with the Fed expected to bring forward its first rate hike and the Bank of England Governor reiterating the need for a rate rise in the UK this year. Paying more for a mortgage is unlikely to boost consumer confidence which is already flagging. Hosted on Acast. See acast.com/privacy for
17/10/2021 • 15 minutes 5 seconds
Have inflation concerns peaked?
Friday 15th October 2021Markets have taken a more positive outlook overnight, with sharp rises in equities in the US and Europe. NAB’s Gavin Friend says it’s been helped by falling bond yields, showing that there’s less immediate concern about rising inflation. That doesn’t mean the problem has gone away, but company earning results in the US have been positive, and there will be some solace in the fact that the growth in producer prices (PPI) seem to have stalled, albeit at very high levels. On today’s podcast we look at inflation in China (where PPI growth persists), the commodity and supply chain sagas, US jobless claims and yesterday’s employment data from Australia. Today US retail numbers are the data to watch for. Hosted on Acast. See acast.com/privacy for more information.
14/10/2021 • 14 minutes 29 seconds
Wages, fuel, supply chains and a not-so-transitory inflation number
Thursday 14th October 2021US CPI numbers were a little higher than anticipated. NAB’s David de Garis says we did see some support for bond yields, but markets slipped back when it was realised the core inflation number was pretty line-ball with expectations. As we’re seeing around the world, prices are being influenced by fuel, supply chains and wages. This morning’s FOMC minutes contained nothing in the way of surprises – it simply cemented-in the belief that the Fed will start tapering this year through to mid- 2022, but the timing of a rate rise seems less certain. UK GDP was also close to expectations, although manufacturing and construction were well down thanks to the ‘pingdemic’. We also look at China’s trade data on the podcast today and discuss Australia’s employment numbers out this morning. Hosted on Acast. See acast.com/privacy
13/10/2021 • 14 minutes 37 seconds
IMF warning central banks to act quickly on inflation
Wednesday 13th October 2021The IMF released revised forecasts overnight, together with a warning that central banks need to tighten their monetary policy if inflation persists. Inflation concerns are certainly growing, backed with evidence in numerous surveys. 30% of small business owners in the US said they expect to lift wages, according to the latest NFIB survey. The latest jobs data for the US and UK shows how tight the labour market is, adding to fears of an inflation spiral. NAB’s Ray Attrill talks through the numbers and the central bank responses, as well as looking ahead to today’s trade data from China and tonight’s CPI numbers from the US. Hosted on Acast. See acast.com/privacy for more information.
12/10/2021 • 14 minutes 54 seconds
Energy prices rise further, central banks more hawkish
Tuesday 12th October 2021Fuel prices are rising, with the gas crisis now pushing up oil and coal prices. On today’s podcast NAB’s Tapas Strickland says central banks are now worried about inflation getting “permanently embedded” (Andrew Bailey’s words) and are becoming more hawkish in their outlook. The latest is the Bank of England, where markets are already pricing in a 50 percent chance of a small increase as soon as next month. Bond yields continue to rise on this new attitude by central banks. Also today, does Australia need to reopen its borders to get the economy back on track? Can we fully recover without the return of a migrant workforce? Hosted on Acast. See acast.com/privacy for more information.
11/10/2021 • 14 minutes 44 seconds
Soft jobs numbers won’t dampen the Fed’s tapering intention
Monday 11th October 2021Non-farm payrolls numbers from the US on Friday were less than expected, but NAB’s Rodrigo Catril says the numbers weren’t as bad as they seem, because they included an upward revision in the month before. The expectation is that the Fed will push ahead with tapering of bond purchases later in the year, with bond yields rising around the world, to multi-year highs in some cases. Inflation remains a concern, because of supply chain disruption, rising fuel prices and wages. That might be good news for the Aussie dollar iron ore rose 6 percent on Friday – but N AB has downgraded forecasts given the expected strength in the US dollar during this climate of uncertainty. Listen in to find out more. Hosted on Acast. See acast.com/privacy for more information.
10/10/2021 • 15 minutes 59 seconds
Everyone seems happy to kick the can
Friday 8th October 2021Two cans are being kicked. The US debt ceiling can is being kicked into December, but the issues remain. The gas can has been kicked along by a promise of more fuel from Russia, but isn’t Europe’s dependency on Russia part of the problem? Meanwhile, the Bank of England’s new chief economist is warning of inflation for longer. Is he positioning for a rate rise? NAB’s David de Garis talks through the overnight market news, as well as looking ahead to the Financial Stability Review from the RBA today, and tonight’s non-farm payrolls numbers in the US. There are plenty of reasons why this should be a strong set of numbers. Hosted on Acast. See acast.com/privacy for more information.
07/10/2021 • 14 minutes 4 seconds
Where is the safe haven?
Thursday 7th October 2021The fuel crisis in Europe and the UK is impacting global markets, with shares taking a hit. There’s been no rush to bonds given the impending inflation concerns, worsened by fuel prices, and most currencies are losing against the US dollar, which is possibly the only safe-haven left right now. It’s been a rollercoaster day, says NAB’s Gavin Friend, with energy prices in the driving seat and upending all markets. The problem is, there doesn’t seem to be a short-term resolution. Listen in to find out why. Plus, strong jobs numbers in the USD. Does this foreshadow a strong non-farms payroll number for the US on Friday? And a vote on the US debt ceiling possible in the next few hours. Hosted on Acast. See acast.com/privacy for more information.
06/10/2021 • 12 minutes 13 seconds
Risk on, with inflation? RBNZ ready to lift rates
Wednesday 6th October 2021The currency markets suggest there’s a risk on mood this morning, with the US dollar gaining on the Japanese Yen and Swiss Franc. Strong non-manufacturing ISM numbers in the US have helped with that. But oil prices continue to rise too, adding to inflation concerns. Yet tech stocks have risen as well. NAB’s Rodrigo Catril joins Phil Dobbie to help explain market positions this morning, on the day that the RBNZ is expected to lift interest rates, despite expectations that the country will face many more COVID cases as the policy switches to one of living with the virus. US jobs will be the focus for the second half of the week, starting with ADP employment numbers tonight. Hosted on Acast. See acast.com/privacy for more information.
05/10/2021 • 14 minutes 46 seconds
Stagflation consternation as OPEC sticks to the plan
Tuesday 5th October 2021Oil prices rose quickly this morning after OPEC+ announced they would stick with their earlier plans of rising production in November by 400 thousand barrels a day. At one stage Brent and WTI were both up more than 3 percent. NAB’s Ray Attrill says it was a surprising response, because there wasn’t a particular expectation that they would rise production. Nonetheless it has added to inflation concerns, and raised more talk about stagflation – will the price increases dampen demand and slow the jobs recovery? It’s a dilemma for central banks and governments. So far though, inflation isn’t having a big reaction on production. The manufacturing ISM in the US was strong n Friday, so was consumer spending. Markets will be watching the data today to see whether demand from the services sector is continuing to push ahead. Hosted on Acast. See <a style='color:grey;' target='_blank' rel='noopener noreferrer' href='https:
04/10/2021 • 14 minutes 24 seconds
China to secure fuel at all costs
Friday 1st October 2021There’s a fair bit to chew on today, with commodity currencies helped by word from China that they must secure enough energy for winter, whatever the cost. The US has managed to agree an interim budget for now, but the debt ceiling remains an issue and will remain so until the very last minute. Jerome Powell pontificated in his congressional hearing about what to do if high inflation persists, but NAB’s Gavin Friend says nothing that was said deflects from the expectation that rate rises in the US are still a long way away. The US dollar has stalled its steady growth for now, in part because of the rise in commodity currencies, but will it resume its steady path? Maybe Europe will come to the fore. After all, they don’t have to debate spending packages, they already have one. Hosted on Acast. See acast.com/privacy</a
30/09/2021 • 14 minutes 38 seconds
Markets calmer, but US budget deadline looms
Thursday 30th September 2021Markets are much calmer this morning. Equities have managed to climb a little, with the biggest moves in currencies and commodities. NAB’s David de Garis says there’s debate about whether we’re heading to reflation, deflation or stagflation, or all of the above. The Aussie dollar lost more ground, but the pound is taking more of a hammering as fuel shortages will almost certainly be hitting the growth outlook there. Over the Atlantic the debt ceiling is looming, but the short-term issue is passing some sort of budget today, so the government can carry on spending tomorrow. Hosted on Acast. See acast.com/privacy for more information.
29/09/2021 • 14 minutes 9 seconds
Dangerous Powell, markets run for cover
Wednesday 29th September 2021It seems like it was a fairly heated Senate Banking Committee meeting in the US overnight. Flags were raised about whether Jerome Powell will win another term as Governor of the Fed, given the background of yesterday’s resignations and with one Democrat Senator overnight calling him ‘dangerous’. The US debt ceiling is also causing concern, with it being used as a bargaining chip for the moderation of Biden’s spending plans. NAB’s Tapas Strickland says we have been here before so the market is not overly concerned about the lack of progress, just yet. We also discuss how the Fed are likely to push ahead with tapering even if employment doesn’t pick up, how China’s growth this year is likely to be hit by rolling power outages, signs that Australia will bounce back quickly out of lockdown and the future for Evergrande. Hosted on Acast. See <a style='color:grey;' target='_blank' rel='noopener noreferrer' href='
28/09/2021 • 13 minutes 56 seconds
Is reflation back? Commodities push even higher
Tuesday 28th September 2021It seems markets are still trading on the hawkishness of central banks, particularly the Fed, where we’re seeing bond yields significantly higher and tech stocks weakening. Commodity prices are also pushing higher globally, with Brent Crude now close to $80 a barrel. NAB’s Gavin Friend in London says these extra costs, plus supply constraints make it highly unlikely that the Bank of England will lift interest rates next year, no matter what Governor Andrew Bailey suggests. Hosted on Acast. See acast.com/privacy for more information.
27/09/2021 • 14 minutes 16 seconds
Add the debt ceiling to the list of concerns
Monday 27th September 2021Last week was a very volatile week, driven by the uncertainty over Evergrande, the unexpected hawkishness of central banks, continued concerns over supply chains and the emerging fuel crisis in the UK and Europe. This week you can add the USD debt ceiling to the list of concerns. NAB’s Ray Attrill says without a stop gap funding resolution we could be going into the weekend with government shutdowns. Also today we look at the German election over the weekend, which could see the government split three ways. And will the Aussie dollar gain ground as “freedom day” in NSW approaches? Hosted on Acast. See acast.com/privacy for more information.
26/09/2021 • 14 minutes 46 seconds
Optimism. But why?
Friday 24th September 2021There’s been a big shift to risk-on overnight, with equities rising and bonds falling, pushing yields much higher in the US and across Europe. But why? The risk of Evergrande remains and with the Fed eyeing jobs data, a rise in weekly jobless claims was hardly a good sign this morning. NAB’s Gavin Friend says part of it is a reaction to the clearer roadmap for the Fed, assuming the next payrolls numbers are strong. Markets were also responding to the Bank of England, who expect inflation in the UK to reach 4 percent this year and that could strengthen the case for “modest tightening of monetary policy”. But if prices are rising because of supply constraints, does a rate hike really make sense? Hosted on Acast. See acast.com/privacy for more information.
23/09/2021 • 14 minutes 54 seconds
Not yet, but soon says the Fed
Thursday 23rd September 2021As expected, the Fed didn’t give a specific date for the start of tapering, but suggested it should all be done by the middle of next year. NAB’s David de Garis says the bank has also moved forward its expectations for rate rises, with the board split on a rise as soon as next year. The Norges Bank is well ahead of them tonight, likely to be the first G20 central bank to lift rates since the pandemic started. The Bank of England meets today too, and inflation concerns will be front and centre, particularly with the crisis in fuel prices. Meanwhile markets were buoyed by the news that Evergrande will pay bondholders, so that can has been kicked down the road for now. Oil has risen as inventors in the US fell faster than expected. And lots of PMI reads today. Hosted on Acast. See acast.com/privacy for more inf
22/09/2021 • 15 minutes 35 seconds
Waiting on Evergrande, the Fed and oil inventories
Wednesday 22nd September 2021Markets are still concerned over the Evergrande debacle, although equities and currencies and bonds have all calmed down a little overnight. China has been on holiday so far this week, so today could provide news on the government’s response before the develop defaults on its bond interest payments. There will be strong interest I the Fed tomorrow morning, of course, but it seems unlikely that they will announce tapering of their asset purchases just yet. NAB’s David de Garis says they will prefer to see another standout jobs report. Also today, can we expect more moves in oil, with the EIA stockpile report tonight. And the OECD has revised growth forecasts down and inflation expectations up. Hosted on Acast. See acast.com/privacy for more information.
21/09/2021 • 13 minutes 13 seconds
Evergrande Contagion Fears
Tuesday 21st September 2021Markets have been running for cover overnight over fears that a default by Evergrande could spread beyond the Chinese property sector to the rest of the world. NAB’s Ray Attrill talks through the response, which has seen equities ditched in favour of bonds, and the money markets running to the Yen and Swiss Franc. But it’s the pound that has fared the worst overnight as their energy crisis continues, which has its own multi-industry contagion. By the time you listen in RBNZ Assistant governor Christian Hawkesby will have given a speech that could impact markets locally, particularly if he gives hints on the size of the expected rate rise. And the Canadian election results will start coming in later today, but there’s every chance it’ll be down to the wire and we won’t know for sure till later in the week. Hosted on Acast. See <a style='color:grey;' target='_blank' rel='noopener noreferrer' href='https://acast
20/09/2021 • 14 minutes 30 seconds
Just another cautious Monday
Monday 20th September 2021There’s more caution in the markets as we kick off a week doinated by central banks – the US Fed, BoE, BoJ, Swiss National Bank, Riksbank, Norgesbank all meeting, but NAB’s Tapas Strickland says it’s the US Fed that has markets on a bit of a holding pattern. There will be particular interest in the mapping of dot points this week. On the podcast there’s discussion about the flattening US yield curve, reasons for the weak retail numbers in the UK, Europe’s gas crisis, and the impact of a potential default by Evergrande in China this week. Hosted on Acast. See acast.com/privacy for more information.
19/09/2021 • 15 minutes 4 seconds
Lots of movement, not much direction
Friday 17th September 2021There was a lot of movement overnight, with US equities falling, then regaining some of the losses in late trade. Most currencies fell against a rising US dollar, but even some of those were pared back as the session progressed. The fall in equities happened despite a rise in US retail numbers, when sales were expected to fall. NAB’s Gavin Friend says markets clearly didn’t know which way to take it. There have, of course, been other surprises in the last 24 hours. Australian employment numbers fell more sharply than anticipated and NZ GDP was stronger than expected, both supporting the relative stance of their respective central banks. There are lots of swings and roundabouts on the road to recovery it seems, creating a lot of investor confusion. Today was one of those days. Hosted on Acast. See acast.com/privacy
16/09/2021 • 14 minutes 21 seconds
High hopes or buying the dip?
Thursday 16th September 2021There’s a little more optimism in the markets this morning, particularly in US equities. NAB’s Tapas Strickland says there’s no overarching good news, suggesting there’s a strong element of ‘buying the dip’. Which could mean it’s all reversed tomorrow! In fact, the news out of China was largely negative, with industrial production, fixed asset investment and retail sales all below expectations. The huge debts of the Evergrande Group are also likely to see authorities tightening financial controls on the construction industry. Inflation was more than expected in the UK and Canada, and will, in both cases, add fuel to the argument that their central banks will raise interest rates at least once next year. Locally, Australia’s employment data will be the numbers to watch, although they are a little out of date. US retail sales will also be one to watch. Hosted on Acast. See <a style='color:grey;' target='_blank
15/09/2021 • 12 minutes 54 seconds
Has US inflation peaked?
Wednesday 15th September 2021Inflation in the US has slowed. Is this a win for those arguing it is all transitory? Phil Dobbie asks NAB’s Rodrigo Catril what this means for the Fed and expectations of tapering. Market moves aren’t just a reaction to the US CPI, there’s also a risk-off mood driven by increasing cases of COVID in China which could cause further supply disruption. The Aussie dollar is still weak after Philip Lowe’s dovish speech at lunchtime yesterday. UK jobs numbers were strong but there are still a million job openings to be filled, by who? And today we’re expecting to see weaker activity numbers from China. Hosted on Acast. See acast.com/privacy for more information.
14/09/2021 • 15 minutes 16 seconds
Oil Higher and RBA’s Lowe-down
Tuesday 14th September 2021Markets are a little mixed ahead of today’s US CPI numbers. But, just how important are these numbers when the Fed is far more focused on returning the country to full employment. NAB’s Tapas Strickland says supply-led inflation is allowing the Fed to be more accommodative for longer. Oil prices hit a six week high overnight, based on supply constraints and OPEC’s expectations for increased demand. Besides US inflation numbers, the focus later will be on UK jobs numbers and, at lunchtime, a speech by the RBA’s Philip Lowe. Hosted on Acast. See acast.com/privacy for more information.
13/09/2021 • 13 minutes 57 seconds
Three reasons to be cautious
Monday 13th September 2021Talks between Biden and Xi on Friday added to market concerns. NAB’s Rodrigo Catril says it was the realisation of how long it would take to resolve issues, if ever. A US investigation into Chinese state subsidies also added to the malaise. On top of that, inflation (driven by supply constraints) and the speed of economy recovery remain two other major concerns. On the price side, US PMIs were higher than expected on Friday, whilst UK GDP growth was slower than expected in July. Rodrigo says there are so many factors making the data very noisy. But if the caution is lifting the US dollar at the expense of the Aussie, is there anything that will change that in the near term? Hosted on Acast. See acast.com/privacy for more information.
12/09/2021 • 14 minutes 13 seconds
ECB, calibrating not tapering
Friday 10th September 2021As NAB’s Gavin Friend vehemently predicted on yesterday’s Morning Call, the ECB has announced that they will cut back purchases under their Pandemic Emergency Programme. It reflects the optimism in Europe, which is not currently matched in the US, where equities are down on the realisation that the recovery is taking time, largely driven by supply constraints that could be with us for a lot longer. There was positive news on jobs, with the weekly initial jobless claims at their lowest level since the pandemic began. US PPI, Canadian unemployment rate, UK monthly GDP and NZ credit card spending are the numbers to look for today. Hosted on Acast. See acast.com/privacy for more information.
09/09/2021 • 12 minutes 59 seconds
Bank of Canada on pause, ECB unlikely to do the same
Thursday 9th September 2021As expected, there were no moves from the Bank of Canada overnight, but NAB’s Gavin Friend says the same will not be true for the ECB tonight. They will cut back on bond buying, he says. In fact, it’s taken longer than expected. Currency markets have been fairly quiet, with most moves happening in equities, which have adopted a more cautious air. The Fed’s Beige Book reflected some of this caution, with many consumers wary of eating out or going on holiday for fear of catching the Delta variant. There’s a rising delta between jobs advertised and employment, with the JOLTs figures showing 10.9 million openings in the US. Boris Johnson pushed ahead with his bold move of lifting taxes in the last few hours, running the risk of slowing a recovering economy. Today, Aussie weekly payrolls, China’s CPI and a speech from the RBA’S Guy Debelle. Hosted on Acast. See <a style='color:grey;' target='_blank' rel='noopener
08/09/2021 • 14 minutes 13 seconds
RBA ready for the bounce back, eventually
Wednesday 8th September 2021The RBA is pushing ahead with its tapering of bond purchases, just as predicted on The Morning Call, but the bank is doing it in a very dovish fashion. There won’t be any further cuts in the quantity until February next year. Does that suggest the RBA is seeing a slower recovery? NAB’s Rodrigo Catril reads between the lines in the RBA statement yesterday, and looks at why the US markets are showing so much caution on the return from the Labor Day holiday. Plus, China’s surprise trade numbers and a look ahead to the Bank of Canada tonight. Hosted on Acast. See acast.com/privacy for more information.
07/09/2021 • 13 minutes 40 seconds
COVID versus the central banks
Tuesday 7th September 2021The RBA meets today and the big question is, will they push on with their tapering schedule, reducing weekly purchases from $5b per week to $4b. NAB’s Ray Attrill says that they will, but there are concerns about the optics of making a move when the economy is in lockdown. The same question applies to the ECB later this week. Central banks have a direction they want to take, but the timing is being determined by the rise in COVID cases. On that, a rate hike by the RBNZ is looking even more likely, as the country starts to ease restrictions as cases are contained. Equities in Europe were up today, and will likely rise in the US as they return from the Labor Day holiday. That too is likely to be a response to the Fed delaying tapering, topping up the punchbowl for a while longer. Hosted on Acast. See acast.com/priva
06/09/2021 • 14 minutes 28 seconds
Far from substantial progress, but just a temporary setback?
Monday 6th September 2021Non-farm payrolls grew well below market expectations I the US on Friday, and are certainly not the substantial progress the Fed has been looming for. Today on The Morning Call NAB’s Tapas Strickland looks at the market response to the payrolls numbers, and other signs that the global recovery might be slowing. Is it just a transitory phase? With that in mind, what will the RBA do about tapering its bond buying, and will the ECB still ease off its purchase under its PEPP? Both meet this week, and the Fed’s Beige Book is out midweek to, to help provide some colour on the state of the US economy right now. Hosted on Acast. See acast.com/privacy for more information.
05/09/2021 • 14 minutes 9 seconds
Only currencies making moves ahead of US jobs numbers
Friday 3rd September 2021There seems to be a lot resting on tonight’s non-farm payrolls numbers from the US. Phil Dobbie asks NAB’s Gavin Friend what the reaction will be if the numbers come in softer or stronger than anticipated? The weekly jobless claims overnight were encouraging, showing the lowest number of new claims since the pandemic began. Whilst equities and bonds have been relatively subdued in the wait, there’s even more movement in currencies, with the Aussie dollar managing to climb back over 74 US cents. Hosted on Acast. See acast.com/privacy for more information.
02/09/2021 • 14 minutes
Markets defensive on fears of slower jobs growth
Thursday 2nd September 2021The ADP employment numbers in the US normally play second fiddle to the non-farm payrolls, but they are out a day earlier, and overnight they only came half way to meeting expectations. NAB’s Gavin Friend says they rarely show any correlation with Friday’s numbers, but they do reflect concerns about growth inhibited by supply chain disruption. The ISM numbers also reported a reduction in employment. On today’s podcast we also look at yesterday’s GDP numbers for Australia, which were a big surprise, but less relevant with most of the population now in lockdown with no clear end date in sight. Hosted on Acast. See acast.com/privacy for more information.
01/09/2021 • 12 minutes 56 seconds
Falling production, higher prices turns sentiment around
Wednesday 1st September 2021Markets have lost their optimism overnight. China’s PMIs came in softer than expected and Canada’s GDP, expected to grow, actually fell. Add falling consumer confidence in the US and there;s plenty of numbers for those looking at the glass half full. Inflation reared its ugly head again too, with Europe’s CPI read much more than anticipated, which could present a headache for the ECB, who had signalled that their emergency bond buying would continue through to next year. Ina amongst all of this, the Aussie and Kiwi dollars rose. NAB’s Ray Attrill says it’s telling as to how much pessimism and bad news was already priced into both these currencies. Hosted on Acast. See acast.com/privacy for more information.
31/08/2021 • 13 minutes 15 seconds
Hold on for the payrolls
Tuesday 31st August 2021It’s been a quiet session overnight and NAB’s Tapas Strickland says its likely to be a quiet week in the run up to non-farm payrolls on Friday, which will give us all a clearer understanding on the speed of the US jobs recovery. The continued high COVID case numbers, a drop in air travel and the threat of an EU ban on non-essential travel from the US haven’t dented market enthusiasm, with the S&P reaching yet another record high. Locally today more GDP partials, which should give us enough data to determine whether tomorrows Q2 GDP number will be negative or positive. China’s PMI numbers will be watched keenly, whilst Chinese authorities will be keeping an eye on computer gamers! Hosted on Acast. See acast.com/privacy for more information.
30/08/2021 • 13 minutes 20 seconds
Powell maintains taper silence
Monday 30th August 2021The Fed chair Jerome Powell didn’t indicate any timing for tapering, as we predicted several times last week on The Morning Call. Yet the markets still reacted. Phil Dobbie asks NAB’s Rodrigo Catril what was said that was interpreted as a more dovish stance than expected. Can the markets maintain their optimistic outlook with a more cautious Fed, and with some data suggesting growth might be slowing. With NSW recording its highest infection rate so far yesterday, and Victoria staying in lockdown beyond Thursday, can the Australian dollar hold the gains it made late last week? Hosted on Acast. See acast.com/privacy for more information.
29/08/2021 • 14 minutes 21 seconds
Kabul blasts hit sentiment, markets hold for Powell’s taper talk
Friday 27th August 2021Market sentiment has been hit by the explosions in Kabul this morning, but NAB’s David de Garis says the response has been fairly limited. It certainly hasn’t knocked currencies and equities out of their trading ranges. No, the real focus today will be on what Jerome Powell says at tonight’s virtual Jackson Hole Symposium. Even though more hawkish members of the Fed are pushing for tapering sooner rather than later, it’s still likely that Powell will retain a wait and see approach. There’s still too much uncertainty to assume jobs will keep bouncing back at the rate we saw in the last non-farm payrolls. The next report is only a week away. Whilst the NSW Premier talks about easing restrictions, the national cabinet meets today to nut out a COVID strategy. Hosted on Acast. See acast.com/privacy for more informatio
26/08/2021 • 14 minutes 46 seconds
High hopes keep getting higher
Thursday 26th August 2021Market optimism continued overnight, with US equities again hitting new highs and commodities climbing sharply too. That's helped the Aussie dollar again today. NAB’s Rodrigo Catril says the sentiment is being driven by infection rates starting to subside in the US. Phil Dobbie asks how fragile this optimism could be, if number were to rise again. The ECB’s Philip Lane painted a positive picture, suggesting the Delta variant won’t impact the European recovery story because fatalities and serious illness have been contained by the vaccine. He also indicated, whether through PEPP or another vehicle, they’ll be providing favourable financing conditions through to next March, at least. It’s very different to the direction being taken by the Fed, but more on that in tomorrow’s podcast. Hosted on Acast. See acast.com/pr
25/08/2021 • 14 minutes 38 seconds
More jabs, more optimism, higher Aussie dollar
Wednesday 25th August 2021The tide of optimism seems to have set in, with another day of rising commodity prices and a strengthening Aussie dollar. Rising iron ore prices and zero new cases in China have also helped the Aussie, as the country gets to grips with life with COVID after lockdown. NAB’s Tapas Strickland says politicians are becoming more explicit about living with the virus, with Gladys Berejiklian expected to announce on Thursday some easing measures for those vaccinated. In New Zealand a rate hike in October is very likely, with the RBNZ signalling that the delay was to do with the timing of the lockdown and little more. Australian construction work data for Q2 is out today – if the number undershoots expectations, it could be enough to push Q2 GDP into negative territory. Hosted on Acast. See acast.com/privacy for more i
24/08/2021 • 13 minutes 8 seconds
Markets turn giddy on COVID news
Tuesday 24th August 2021There’s been a swift turn in market sentiment, with US equities pushing new highs and oil bouncing back sharply. NAB’s Rodrigo Catril says there are early signs that the rise in COVID cases in the US might have peaked, whilst the official approval of the Pfizer and BioNTech vaccines might encourage more people to come forward for the jab. PMIs told a less positive story, with services growth slowing in the US and, for now, Europe seemingly showing more growth. Amongst all the commotion, bond markets remaining quiet, waiting for any hint of policy direction from Jerome Powell at this Friday’s virtual Jackson Hole symposium. Hosted on Acast. See acast.com/privacy for more information.
23/08/2021 • 12 minutes 5 seconds
Kaplan’s hawkish wings are clipped
Monday 23rd August 2021Equities recovered in the US at the end of last week as markets responded to comments from Robert Kaplan, President of the Dallas Fed. NAB’s Ray Attrill says the FOMC member has changed his hawkish stance, now admitting the Delta variant was dampening demand and that could slow the speed of tapering by the central bank. In Asia it’s a different story, with equities hit by further evidence of increased regulation, mixed with the slowdowns associated with a zero COVID approach that is hitting supply and production. Locally, of course, rising infection numbers and extended lockdowns will continue to hurt the Aussie economy. Today PMIs for the Eurozone, the UK and Australia will give an indication of the relative rate of recovery around the world, although possibly, a little out of date given how quickly the global situation is changing. Hosted on Acast. See <a style='color:grey;' target='_blank' rel='noopener noref
22/08/2021 • 14 minutes 34 seconds
Commodities fall, VIX jumps, Aussie hit hard as growth concerns rise
Friday 20th August 2021There are more concerns over the global growth story, with commodity prices falling and the Aussie dollar one of the hardest hit currencies this morning. NAB’s David de Garis says China’s growth is one of the biggest concerns. Phil Dobbie asks whether expectations were set too high. COVID case rises continue to play on uncertainty, with another report showing how the efficacy of vaccines can quickly deteriorate, hence the need for booster shots. Debates over the time of the Fed’s tapering continues, but it’s unlikely we’ll hear more at Jackson Hole next week. Aussie employment numbers yesterday might have surprised on the upside, but it wasn’t as strong as the headline would suggest and, in any case, it won’t last with lockdowns continuing. Once again, COIVD cases for NSW, Victoria and NZ will be the most important numbers of the day today. Hosted on Acast. See <a style='color:grey;' target='_blank' rel='noopener
19/08/2021 • 13 minutes 46 seconds
Central banks holding back
Thursday 19th August 2021The RBNZ didn’t push interest rates up yesterday, in light of the national lockdown. NAB’s David de Garis says the decision has been pushed back to October, all being well. It all depends on COVID numbers of course. Australia’s jobs numbers today are less relevant than usual given that they only covered the start of the NSW lockdown – the real numbers of concern will be infection rates. The FOMC minutes highlighted the divide that exists in the Fed on the speed of tapering, with Bullard suggesting tapering should be pushed back to next year, but finished in time for a rate hike later in the year. All this is putting markets on hold, with shares taking a knock and bond yield hardly moving. Hosted on Acast. See acast.com/privacy for more information.
18/08/2021 • 14 minutes 30 seconds
Will RBNZ still hike rates today, even in a lockdown?
Wednesday 18th August 2021With New Zealand in lockdown will the RBNZ still push ahead with its expected rate rise today? NAB’s Rodrigo Catril says central banks take a mid-term view, and the inflation and housing pressures remain, so it’s likely they will stick with the plan, but by no means certain. US markets took a confidence hit as retail sales and the NAHB housing index both came in much lower than expected. There was further evidence of rising costs, which were also reflected in the UK’s employment numbers yesterday. Today UK inflation data is out, plus Australia’s wage price index, and the FOMC minutes. And that RBNZ decision. Hosted on Acast. See acast.com/privacy for more information.
17/08/2021 • 13 minutes 58 seconds
China’s slowdown gives confidence another blow
Tuesday 17th August 2021Markets remain unsure as to the speed of the global recovery, but there’s mounting evidence that the full extent of the rebound will be delayed. That’s obviously the case in Australia, but the US we reported on Friday’s falling consumer sentiment, overnight the Empire State manufacturing index underwhelmed. This will increase the focus on US retail sales today. Overnight, though, the response has been to data from China, where retail sales, industrial production and fixed asset investment – were all weaker than anticipated, with the unemployment rate ticking up a little too. NAB’s Ray Attrill talks through NAB’s revised forecast for China’s growth. Locally the RBA minutes are out today, but they are somewhat out of date, given the change in circumstances. Hosted on Acast. See acast.com/privacy for more informati
16/08/2021 • 13 minutes 7 seconds
Back to uncertainty
Monday 16th August 2021The US dollar lost a lot of ground on Friday, with Treasury yields falling, both on the back of a much weaker than expected consumer confidence report in the US. NAB’s Tapas Strickland says this is the lowest read since the pandemic began. So, will treasury yields bounce back? Supply concerns have been exacerbated by the temporary closure of one of the world’s busiest container ports, after just one COVID case. Could a zero-COVID policy from China lead to much more disruption in coming months? Locally lockdowns look set to continue for longer, but the expectation is that the economy will bounce back quickly afterwards, provided we don’t see a significant rise in unemployment. Activity numbers from China today will give an indication of the extent of the slowdown in the recovery of the global economy. Hosted on Acast. See <a style='color:grey;' target='_blank' rel='noopener noreferrer' href='https://acast.com/pri
15/08/2021 • 13 minutes 58 seconds
On the road to nowhere
Friday 13th August 2021There was very little movement in the markets overnight, with thing trading during the northern summer, compounded by any significant news. Bond yields have edged higher, with another successful auction, whilst equities have ground higher, with new highs for the S&P. NAB’s Gavin Friend says we’re at the point of the month when things quieten down. Even news of more regulation from China did little to impact markets. UK GDP was strong and US jobless claims fell, but these, and other data points overnight, came as no surprise to anyone. So a quiet day. Enjoy it while it lasts. Hosted on Acast. See acast.com/privacy for more information.
12/08/2021 • 12 minutes 27 seconds
Inflation the way the Fed wanted it
Thursday 12th August 2021US CPI eased in July. NAB’s David de Garis says it was helped by less pressure on used car prices and airline fares, whilst food prices remain elevated. It means the Fed can focus on reaching their employment target, whatever that target is. In a speech overnight Raphael Bostic suggested it wasn’t just about hitting full employment, it was also about fixing the inequality brought about by the pandemic. Meanwhile, the market is sold on the idea of tapering starting sometime in the next few months. At home, consumer confidence fell, but optimism is greater amongst those who have had the jab. UK GDP numbers are out today and will be better than last time, simply because it covers a period when lockdowns eased. Hosted on Acast. See acast.com/privacy for more information.
11/08/2021 • 14 minutes 25 seconds
Will US CPI give markets the direction they are looking for?
Wednesday 11th August 2021Markets are a little more optimistic today, but there seems little rhyme nor reason. NAB’s Ray Attrill says oil has bounced back, seemingly ignoring yesterdays concerns about slowing demand from China in light of COVID cases and lockdowns, even though the situation is only getting worse. The NAB Business Survey demonstrates the extent of the situation in Australia. Could a protracted lockdown see the RBA reverse its decision to introduce tapering next month? Generally, markets are looking for direction. Even the passing of Biden’s Infrastructure Bill through the senate has seen very little response. Will the US CPI numbers today provide some direction? Hosted on Acast. See acast.com/privacy for more information.
10/08/2021 • 14 minutes 52 seconds
Code red, but focus is on the Fed
Tuesday 10th August 2021The UN chief has called the latest IPCC report on climate change “a code red for humanity”. The shorter timeframes for rising temperatures has not had any market influence. NAB’s Tapas Strickland says, instead, the focus has been split between how quickly the Fed will introduce tapering, and concerns over whether the recovery will slow, with rising cases and more lockdowns. Oil has fallen further as flight numbers fall and the anticipation of less travel for the remainder of the year increases. Today the NAB Business Survey will reflect the lockdowns in Sydney and beyond, which Tapas points out, are likely to extend beyond the assumptions in the RBA’s latest forecasts. Hosted on Acast. See acast.com/privacy for more information.
09/08/2021 • 14 minutes 9 seconds
US jobs – is this ‘substantial progress’?
Monday 9th August 2021There was a strong market reaction to Friday’s non-farm payrolls in the US, which NAB’s Rodrigo Catril says was at the top end of a broad range of expectations. The question is, does this represent the substantial progress that the FOMC is looking for before tapering bond purchases. It depends on which Fed member you are listening to. We’ve seen the response to the jobs numbers in equity markets, bond yields and the strengthening of the US dollar. That’s contributed to a weaker Aussie and Kiwi dollar, which could take another hit from weaker trade data from China over the weekend. So, will the Aussie recover? Protracted lockdowns will have an impact, with NAB at odds with the RBA on near term growth. How quick the recovery, obviously depends on vaccine rates. Hosted on Acast. See acast.com/privacy for more informa
08/08/2021 • 16 minutes 9 seconds
Watch Germany go
Friday 6th August 2021I amongst the mixed data from the US – including signs that the job recovery is slowing - and the varied opinions of central bankers, take a look at what’s happening in Germany. Factory orders came bouncing back in June and Google mobility data is showing most people are heading back to work. NAB’s Gavin Friend says this adds to the strong GDP numbers last week. The extent to which these surpassed US growths hasn’t been given enough consideration, he says. Also today, the Bank of England ups its inflation forecast to 4% by the end of the year and all eyes will be on the non-farms payrolls data tonight – with a wide range of predictions, so take your pick! Hosted on Acast. See acast.com/privacy for more information.
05/08/2021 • 14 minutes 41 seconds
Jobs boost for NZ, whilst US jobs fail to pick up
Thursday 5th August 2021The New Zealand unemployment rate has fallen sharply, adding more to the expectation that the RBNZ will lift interest rates next month. NAB’s David de Garis says the markets have now priced it in at more than 100 percent. US jobs, however, are taking longer to recover. The ADP employment report saw far fewer new jobs than expected. Although all eyes are on the more credible non-farm payrolls number on Friday, the ADP report did knock the S&P off its record high. Today, the Bank of England meets, although we can’t expect them to be signalling anything of significance. Hosted on Acast. See acast.com/privacy for more information.
04/08/2021 • 14 minutes 48 seconds
A tale of two central banks, both focused on a strong recovery
Wednesday 4th August 2021Central banks seem to be taking a very optimistic view of the rate of recovery right now. The RBA has decided it will push ahead with its tapering of asset purchases, despite the protracted Sydney lockdown. The RBNZ’s Governor Orr has as good as said that the central bank will lift interest rates next month. The direction taken by the US Fed will be dependent on jobs numbers, making the non-farm payrolls data all that more important at the end of the week. Meanwhile US equities have bounced back as investors take stock of strong corporate earnings. NAB’s Tapas Strickland says 88% of S&P 500 companies have reported a positive earnings surprise for Q2. Of concern, though, are rising infection rates in China. Mass cancellation of flights has been influential in the fall in oil prices again overnight. Hosted on Acast. See <a style='color:grey;' target='_blank' rel='noopener noreferrer' href='https://acast.com/priva
03/08/2021 • 13 minutes 58 seconds
More caution on manufacturing undershoot
Tuesday 3rd August 2021There was a sharp drop in Treasury yields soon after the release of the ISM Manufacturing numbers from the US. The expectation was that they would rise slightly, but they actually fell. Although still in expansionary territory NAB’s Rodrigo Catril says it adds to the narrative that the speed of recovery is slowing. It was compounded further with weaker Caixin PMI manufacturing numbers from China. At home the RBA is fully expected to reverse its plans to start tapering its bond purchases from September, as NSW focuses more on increasing the vaccine rate as the only way out of lockdown. Hosted on Acast. See acast.com/privacy for more information.
02/08/2021 • 14 minutes 30 seconds
Has China fallen out of love with Aussie iron ore?
Monday 2nd August 2021Iron ore prices fell below U$200 on Friday as China indicated that they would be cutting demand. It hit the Aussie dollar on Friday, which was already suffering as virus cases mounted in several parts of the country and no immediate escape plan for the Sydney lockdown. Today, Phil Dobbie asks NAB’s Ray Attrill whether the Aussie dollar could fall to 73 cents again this week, or lower, and whether that’s such a problem, given it has spent much of the last few years below that level. Also today, how Friday’s data showed that Europe is gaining momentum over the US on the recovery race. And mixed messaging from the Fed, but tapering is not likely to start anytime soon. Hosted on Acast. See acast.com/privacy for more information.
01/08/2021 • 14 minutes 8 seconds
US GDP was better than it looks
Friday 30th July 2021Markets have had a chance to absorb the dovish sentiment from the Fed yesterday and take stock of mixed data overnight. On the surface US GDP numbers looked weaker than anticipated, but a chunk of that was influenced by lower inventory and trade numbers. NAB’s Gavin Friend explains how consumption and investment was actually much higher than anticipated. He says we can expect a strong GDP read for the Euro are later today, where vaccine levels are picking up. Markets have also been soothed from conciliatory messages from China regarding overseas investors. The Aussie dollar showed slower growth on the back of a weaker US dollar, as the question remains, how long will the Sydney lockdown really last? Hosted on Acast. See acast.com/privacy for more information.
29/07/2021 • 14 minutes 1 second
Markets turn as Powell reaffirms ‘some way to go’
Thursday 29th July 2021There was a tame response to the FOMC statement this morning, but a more marked reaction during the press conference that followed. NAB’s David de Garis says the turning point was Powell’s remark that there was some ground to cover when it came to reaching full employment. Also on today’s podcast, discussion on yesterday’s Aussie CPI numbers, and how the widening trade deficit has seen a downgrade to US GDP expectations later today. And the US infrastructure bill might finally be voted on, but we’ll explain why markets are unlikely to be too interested. Hosted on Acast. See acast.com/privacy for more information.
28/07/2021 • 14 minutes 1 second
Rocky road for China investors
Wednesday 28th July 2021Whilst US equities edged to all-time highs, the real yields on US Treasuries sank to new lows. NAB’s Rodrigo Catril talks about how expectations for tapering by the Fed could be pushed back, as the recovery slows. The take-up of vaccines in the US isn’t helping, with the seven-day average of daily jabs now at the lowest level since early January. In the UK infection rates are falling – but still very high – but hospitalisations are increasing. Whilst in the Sydney region lockdowns are likely to last longer, with almost 400k people claiming disaster payments, according to today’s AFR. So, plenty of reason for caution, and the waiting game is on for the response from the Fed later this week. Hosted on Acast. See acast.com/privacy for more information.
27/07/2021 • 13 minutes 38 seconds
Real yields reach lows, vaccine reach slows
Tuesday 27th July 2021Whilst US equities edged to all-time highs, the real yields on US Treasuries sank to new lows. NAB’s Rodrigo Catril talks about how expectations for tapering by the Fed could be pushed back, as the recovery slows. The take-up of vaccines in the US isn’t helping, with the seven-day average of daily jabs now at the lowest level since early January. In the UK infection rates are falling – but still very high – but hospitalisations are increasing. Whilst in the Sydney region lockdowns are likely to last longer, with almost 400k people claiming disaster payments, according to today’s AFR. So, plenty of reason for caution, and the waiting game is on for the response from the Fed later this week. Hosted on Acast. See acast.com/privacy for more information.
26/07/2021 • 13 minutes 32 seconds
High hopes, big concerns and fewer babies
Monday 26th July 2021Last week markets were pulled between concerns over the rise of the Delta variant and the encouragement of strong corporate earnings data. This week could go either way, with significant earnings to come, and mixed opinions on the direction the virus will take. In today’s podcast NAB’s Tapas Strickland looks at the latest vaccine efficacy numbers and the influence on the Aussie dollar. Which was one of the biggest losers last week. We also look at the PMIs from Friday shows, which suggest Europe might have the edge on the US for growth. And the American economy has something else to contend with, slower population growth. Hosted on Acast. See acast.com/privacy for more information.
25/07/2021 • 13 minutes 51 seconds
Strong earnings, cautious ECB and NZ’s first day without QE
Friday 23rd July 2021Equities have been helped by earnings results and a little less COVID concern. On the macro front US jobless claims rose unexpectedly, but NAB’s Gavin Friend says a lot of it will be to do with seasonal adjustments related to the annual auto-tooling shutdowns. The ECB held its first meeting since it’s new straight 2 percent target, but little will change in the short term. The UK economy could be hit by track and trace ‘pings’ that are spreading like wildfire. Aussie payrolls numbers yesterday reflected the current shutdowns, which are likely to go on for much longer. Over the water New Zealand has its first day without QE – we look at the market response. Hosted on Acast. See acast.com/privacy for more information.
22/07/2021 • 14 minutes 3 seconds
Risk back on with rebound expectations
Thursday 22nd July 2021The rebound from the COVID concerns at the start of the week is now complete, with bond yields rebounding further overnight, equities bouncing higher and commodities on the rise. NAB’s David de Garis talks about how businesses are seeing the recovery happen, even where he is in London. Globally, it seems the expectation is that COIVD won’t hinder a global recovery, particularly as vaccine numbers rise. So what does that mean for the ECB today, particularly if growth is expected to rise and their outlook remains dovish? And Brexit is back, struggling over the NI border issue that was never resolved, perhaps because there isn’t an answer. Hosted on Acast. See acast.com/privacy for more information.
21/07/2021 • 14 minutes 24 seconds
Markets recover, but why?
Wednesday 21st July 2021Curiously, much of the negative market reaction at the start of the week has seen a reversal in the last 24 hours, even though the reasons for the concern remain. The Delta variant continues to spread, vaccination rates have slowed, and case numbers are rising. Phil Dobbie asks NAB’s Ray Attrill if he can explain the switch in direction, with the response far stronger for equities than it is for bond traders. They also discuss the next moves for the RBA, with more lockdowns across Australia, and what to expect from the ECB tomorrow. Plus, Aussie retail sales numbers are out today. However poor they are for June, we know July will be worse. Hosted on Acast. See acast.com/privacy for more information.
20/07/2021 • 14 minutes 18 seconds
Markets Hit by the Delta Blues
Tuesday 20th July 2021There’s not been a lot of economic data around, but markets have dipped sharply on the back of rising COVID cases. NABs Tapas Strickland says its being driven by the preponderance of the Delta variant. Oil is also down, in part because of the OPEC deal discussed yesterday, but also expectations of a slower global economic recovery and less international travel. Further tensions with China are adding to the uncertainty, with the US now implicating Chinese nations in the hacking of Microsoft servers earlier in the year. This will add to the tensions between Australia and China. A quiet day today, with the RBA minutes from a meeting that won’t have reflected the growing global concerns, which could delay the bank’s decision of when to taper asset purchases. Hosted on Acast. See acast.com/privacy for more information.
19/07/2021 • 13 minutes 43 seconds
OPEC drip feeds more oil
Monday 19th July 2021OPEC reached a deal of sorts over the weekend which will see supplies increase incrementally over the next few months. NAB’s Rodrigo Catril said markets had been expecting a deal of this magnitude, so it has done little (so far) to oil prices. Meanwhile, COVID caution continues to rein over the markets, with a stronger US dollar and a weaker Aussie. US retail numbers were strong on Friday, but we discuss Google data which suggests store visits are plateauing below pre-COVID levels in most parts of the world. New Zealand’s strong inflation numbers at the end of last week cemented the likelihood of action by the RBNZ, and this week will be the ECB’s first change to issue guidance reflecting its new strategy. Hosted on Acast. See acast.com/privacy for more information.
18/07/2021 • 12 minutes 56 seconds
Cautious for no clear reason
Friday 16th July 2021Markets returned to a more cautious outlook overnight, with US equities losing ground and bond yields falling. As NAB’s David de Garis explains, its difficult to find any particular reason for the change in sentiment, other than a return to concerns over COVID and the speed of economic recovery. There wasn’t anything in day two of Jerome Powell’s testimonies to cause concern and US data overnight was largely positive. The Aussie dollar felt the impact of the mood of the day, even though there was a very strong set of employment numbers yesterday. The UK’s employment numbers told a different story. And data from China suggest the slowdown is not as bad as feared, but likely to be enough to spark more stimulus from the PBoC. Today, the NZ CPI read will be the focus of attention. Hosted on Acast. See acast.com/privacy
15/07/2021 • 15 minutes 16 seconds
More inflation, RBNZ moves first
Thursday 15th July 2021There’s a world of difference in the approaches being taken by central banks in response to the COVID recovery. NAB’s Gavin Friend talks through some of them, starting with the RBNZ announcing bond buying will end next week, leaving the door open for rate rises as soon as August. The Bank of Canada is also tapering its asset purchases. Yet, as inflation rises, the Fed’s Jerome Powell has been reiterating to Congress that tapering will not start anytime soon. The UK also saw inflation rise yesterday, but the BoE is not in any hurry to change direction, neither is the RBA. Who’s got the right idea? Today we will see jobs numbers for Australia and the UK, plus the weekly unemployment claims for the US, and a heap of data from China, including Q2 GDP. Hosted on Acast. See acast.com/privacy for more information.
14/07/2021 • 13 minutes 7 seconds
Another US inflation surprise. Still transitory?
Wednesday 14th July 2021US inflation has surprised again. It was expected to ease back after the 5% jump last month, but this time its higher still. Phil Dobbie asks NAB’s Tapas Strickland whether this will be enough for the Fed to be forced into tapering sooner than intended, or is it still transitory? As luck would have it, Jerome Powell is talking to Congress later today, so maybe we’ll get an inkling of a change in timelines. Also today, decisions from RBNZ and the Bank of Canada, two central banks in more of a hurry than most. Plus, China’s trade numbers, the NAB business survey and the Bank of England’s stability review. Hosted on Acast. See acast.com/privacy for more information.
13/07/2021 • 15 minutes 34 seconds
Stocks high on earning hopes; times changing for ECB
Tuesday 13th July 2021US stocks hit new highs as Q2 earnings season kicks off. NAB’s said it also reflects a recovery from Asia emanating from China’s easing of reserve requirements. China will be a focus today, too, with the release of trade data. US CPI is also out today. Could a combination of weaker earnings reports, a fall in trade to and from China and/or a higher-than-expected CPI dampen the mood? The other significant news overnight has been Christine Lagarde’s Bloomberg interview were she spoke about PEPP continuing in some form from 2022. Will we see central banks taking a more dovish stance as COVID numbers continue to raise concern? Hosted on Acast. See acast.com/privacy for more information.
12/07/2021 • 13 minutes 35 seconds
Delta’s day off
Monday 12th July 2021For most of last week markets grew increasingly cautious about the spread of the Delta variant and fears of further lockdowns in major economies, Australia included. On Friday, though, that all changed, with bond yields rising, equities breaking new highs, the US dollar back on the rise, but the Aussie also doing well along with other commodity currencies. This morning, NAB’s Ray Attrill looks for reasons behind the shift in sentiment, including better credit numbers from China and a more extensive and sharper than expected cut in the reserve requirement ratio for Chinese banks. So, has the mood shifted? It’s a busy week ahead, including US CPI numbers, which markets have been particularly sensitive too recently. Who’s to say caution doesn’t swiftly return on the back of more virus news. Hosted on Acast. See acast.com/
11/07/2021 • 14 minutes 20 seconds
2 percent or not 2 percent, that is the question
Friday 9th July 2021Is it below 2 percent or at 2 percent? The ECB has made subtle changes to its inflation target, but has flatly rejected the Fed approach of average inflation targeting. NAB’s David de Garis explains what’s changed in the ECB’s approach. Plus words from Philip Lowe yesterday about the RBA’s reluctance to shift policy until unemployment is (much) lower. Plus, oil up as US supplies fall, and the reflation trade takes a breather as COVID concerns rise. Listen in for the detail. Hosted on Acast. See acast.com/privacy for more information.
08/07/2021 • 14 minutes 48 seconds
Fed minutes trumped by ECB strategy review
Thursday 8th July 2021The FOMC minutes were released this morning, but a more significant central bank release could be out later in the day. Christine Lagarde is said to be released the outcome of the ECB’s extensive strategy review. NAB’s Gavin Friend talks to Phil Dobbie about what’s likely to be in it and how much of it could be market changing. The Fed minutes meanwhile, had little impact on the markets, which continue to exercise caution as further data suggests a slowdown in the speed of the global economic recovery. Hosted on Acast. See acast.com/privacy for more information.
07/07/2021 • 15 minutes 2 seconds
Markets cautious on numerous fronts; RBA focuses on data not dates
Wednesday 7th July 2021Bond yields have fallen markedly as markets adopt a more cautious air. NAB’s Rodrigo Catril says it’s being driven by a number of factors, including weaker than expected ISM services numbers from the US and factory orders from Germany. The main concern in the ISM was the employment data which dropped below 50, reinforcing the belief that there is a constraint in the availability of labour. A more controlling influence from China, the growth of a more virulent COIVD strain and the uncertainty over an OPEC deal have all added to the caution. So will a strong JOLTs number and the minutes of the last FOMC meeting do anything for turn the sentiment around today? There’s also discussion on yesterday’s RBA meeting, which left the door open to earlier rate rises and tapering of QE, driven by data not dates. Hosted on Acast. See <a style='color:grey;' target='_blank' rel='noopener noreferrer' href='https://acast.com/priva
06/07/2021 • 13 minutes 43 seconds
Freedom Day for the UK, D-Day for the RBA
Tuesday 6th July 2021Boris Johnson has told the UK public that they are just two weeks away from removing their masks, getting back to work and forgetting about social distancing. Within reason. Is this why the pound had such a strong day today, on what’s been a quiet session with the US holiday. Today, we know something will change with the RBA. That’s why Philip Lowe has scheduled a press conference this afternoon. But what exactly will be decided? NAB’s Ray Attrill talks through the possibilities. More importantly, what will cause the market to react? And oil rises sharply as OPEC+ talks fall apart. Hosted on Acast. See acast.com/privacy for more information.
05/07/2021 • 13 minutes 59 seconds
Payrolls just the job for Goldilocks
Monday 5th July 2021Not too strong not too light, that seems to be the view of the non-farm payrolls in the US on Friday. It wasn’t strong enough to signal change in the Fed’s direction says NAB’s Tapas Strickland. At the current pace, he said, it would take eight months to get back to the pre-pandemic level for payrolls. There’s also discussion about changes expected from the RBA tomorrow. It’s been well signalled that there will be policy changes. Tapas says, given the improvements in the Australian economy, the need to run QE at $100 billion every six months is not there anymore. Hosted on Acast. See acast.com/privacy for more information.
04/07/2021 • 12 minutes 6 seconds
The last day of treading water
Friday 2nd July 2021Markets have been treading water all week waiting for the non-farm payrolls data, particularly in bond yields which hardly moved at all in the last 2 4hours. NAB’s Gavin Friend says there’s been a lot of data for markets to chew over too, some of it below expectations, some of it over. Markets are clearly looking for direction and hoping that payrolls will provide it. In the podcast we also look at yesterday’s manufacturing, trade, dwellings and job vacancy numbers from Australia – all good, although the Aussie dollar was one of the weaker currencies overnight. Why? Hosted on Acast. See acast.com/privacy for more information.
01/07/2021 • 13 minutes 48 seconds
Ignoring the talk, waiting for the facts
Thursday 1st July 2021As we’ve mentioned before, central bank speakers are having little influence on the markets since the sharp response to the last FOMC meeting. As David de Garis says on today’s podcast, investors should wait for the evidence, with the non-farm payrolls on Friday the next significant cab off the rank. The ADP numbers overnight were down on April, and could be revised down further, as is often the case. There’s also discussion about weakness in the Aussie dollar, despite the iron ore price, Andy Haldane’s parting words from the Bank of England and uncertainty over China’s growth. Hosted on Acast. See acast.com/privacy for more information.
30/06/2021 • 14 minutes 55 seconds
Confidence rising, but so is the Delta strain
Wednesday 30th June 2021Markets have largely moved sideways, pulled between rising confidence numbers in the US and Europe, and concerns about rising cases of the Delta strain. As NAB’s Rodrigo Catril explains, the Conference Board’s labour market differential index, which looks at the ratio between those who see jobs as being plentiful and this finding them hard to get, came in at the highest level since 2000. Also today, discussion on Christine Lagarde’s green plans for Europe, the direction of the Chinese economy and house price concerns. Today, Australian Private Sector Credit will be of interest along with the ADP jobs numbers for the US. Hosted on Acast. See acast.com/privacy for more information.
29/06/2021 • 14 minutes 17 seconds
Reflation retreats a little as virus spreads further
Tuesday 29th June 2021A little more cautiousness has crept back into the markets says NAB’s Tapas Strickland, although it might be as much to do with the prelude to the non-farm payrolls numbers at the end of the week as it is to do with rising infection rates as lockdowns. On today’s podcast we look at vaccine numbers and what needs to happen to see economies can on full footing. Plus, Tapas’ taker on yesterday’s Intergenerational Report for Australia. Germany’s CPI numbers will be watched closely today, as do all inflation numbers lately. Hosted on Acast. See acast.com/privacy for more information.
28/06/2021 • 13 minutes 38 seconds
Lock down means no RBA lowdown
Monday 28th June 2021With Sydney suddenly flung into lockdown, Phil Dobbie asks NAB’s Ray Attrill what the market reaction will be today. One immediate repercussion will be we won’t hear anything from the RBA ahead of next week’s meeting. Markets also open today with the weekend news that Joe Biden has backtracked on his latest stimulus bill. It’s not such a done-deal after all. There’s also discussion about the path the markets take having retraced their response to the FOMC meeting the week before last, particularly when there remain so many known unknowns. Hosted on Acast. See acast.com/privacy for more information.
27/06/2021 • 13 minutes 53 seconds
Biden whittles down plan to win support
Friday 25th June 2021Joe Biden has struck a deal to push ahead with his infrastructure plan – a much reduced version. That’s helped US equities today. Ahead of that, it was a mixed day on the markets says NAB’s Gavin Friend, as Fed speakers gave mixed views on the duration of inflation and the Fed’s likely response. Data was also mixed, with weekly jobless claims not falling as much as hoped and durable goods orders a little weaker than expected. The Bank of England, who might have been a little more hawkish, actually took a very dovish stance. The data form Europe was largely positive and today the US personal income and spending will be of interest, along with the core PCE deflator, but, there again, we already know prices are rising. Hosted on Acast. See acast.com/privacy for more information.
24/06/2021 • 14 minutes 29 seconds
The crawl back is done, reflation takes over
Thursday 24th April 2021The crawl back from last week’s FOMC surprise is more or less complete. As NAB’s David de Garis points out, Treasury yields are back to where they were just before the Fed met. Equities are back to on the rise and commodities and being driven higher by demand and supply constraints. The reflation trade is back. On today’s podcast we go through the plethora of PMIs from Europe and the US, with more data from Europe today. The Bank of England meets later. The heavily-vaccinated UK population seem to be adapting to life with the virus. Could that influence the outlook for the Bank of England later on? Hosted on Acast. See acast.com/privacy for more information.
23/06/2021 • 12 minutes 5 seconds
Fed cools things down; words from the RBA later
Wednesday 23rd June 2021Jerome Powell has been giving is testimony on Capitol Hill and he, like all the Fed speakers over the last 24 hours, has been trying his hardest to calm the markets and reassure them that inflation won’t last, so the Fed won’t be tapering soon or bringing forward rate increases. It seems to be working, with another day of a weakening US dollar and rising equities. This week tentatively suggests that the global reflation trade is not dead, says NAB’s Ray Attrill on today’s podcast. Plus, loads of PMIs today, for Australia, Europe and the US, we look at the winners and losers. And the first words from the RBA since those strong jobs growth numbers last week. Hosted on Acast. See acast.com/privacy for more information.
22/06/2021 • 14 minutes 18 seconds
Swift turnaround as markets rethink FOMC response
Tuesday 22nd June 2021Well, we did say it was a rather extreme reaction to the FOMC meeting last week. NAB’s Tapas Strickland says the market moves overnight suggest the response was overdone, as markets partially unwound, with the US dollar falling, the yield curve steepening again, US equities up and the Aussie dollar on the rebound. So, what’s driven this rethink and will it last? Will Jerome Powell have an influence on it all when he speaks in front of a US government committee later? On today’s podcast we also examine yesterday’s Australian retail numbers, dissect what Christine Lagarde had to say from the AECB, and look ahead to what’s on today. Hosted on Acast. See acast.com/privacy for more information.
21/06/2021 • 12 minutes 20 seconds
Aussie dollar caught in the storm
Monday 21st June 2021The US dollar continued to rise at the end of last week., hitting a two-month high, after the surprisingly bullish outlook from the Fed, but is the Aussie dollar paying too high a price? NAB’s Rodrigo Catril says the Aussie is in the middle of the storm, with the unwinding of the reflation trade pushing US equities and commodities lower. The Aussie dollar broke through a few technical levels at the end of the week, will it pick back up? Today we discuss movements in currencies and bond yields at the end of the week and what the week has in store for us. Hosted on Acast. See acast.com/privacy for more information.
20/06/2021 • 14 minutes 5 seconds
NZ GDP, Aussie employment both punch the lights out, but currencies fall
Friday 18th June 2021The US dollar continued to rise yesterday, after the hawkish comments from the Fed. As David de Grais discusses on today's podcast, it’s impetus was enough to squash any positive currency response to Australia’s employment numbers and New Zealand’s GDP read yesterday, both of which were way higher than anticipated. And yet Philip Lowe continued to set the expectation that Australian rates wouldn’t rise until 2024. The road to recovery isn’t straight forward though, with US unemployment claims rising last week and Britain’s infection rate rising sharply, despite the vaccines. UK retail sales will garner a bit of attention today. Hosted on Acast. See acast.com/privacy for more information.
17/06/2021 • 13 minutes 57 seconds
Fed speeds up rate hike roadmap
Thursday 17th June 2021At the FOMC meeting this morning the Fed upped their growth and inflation forecasts, twit the dot plots pointing to rate rises as soon as 2023. It’s a much more hawkish meeting than had been anticipated although, NAB’s Gavin Friend wonders whether enough has changed in the Fed’s forecasts to warrant such a shift. UK CPI is another indicator that exceeded expectations. We’re getting that a lot lately. Today’s Australian employment data is also discussed in today’s podcast, along with Philip Lowe’s speech in Toowoomba later on. Hosted on Acast. See acast.com/privacy for more information.
16/06/2021 • 13 minutes 35 seconds
Retail sales numbers add to caution ahead of the FOMC
Wednesday 16th June 2021The FOMC meeting is just a day away are markets are being cautious, with little movements in bonds or equities. A weaker than expected set of retail sales numbers has added to the uncertainty. But is there any uncertainty around what the FOMC will say. NAB’s Tapas Strickland says under the hood the retail numbers had some positives, including more evidence of the rotation from goods to services. We also look at the rising price of oil, and the fall in other commodities. Coming up, other than the FOMC meeting, we’ll see China’s retail sales numbers, CPI for the UK and Canada and New Zealand’s balance of payments and current account. Hosted on Acast. See acast.com/privacy for more information.
15/06/2021 • 13 minutes 56 seconds
Oil nudges higher, bond yields bounce back ahead of FOMC meeting this week
Tuesday 15th June 2021Oil has hit a two-year high. This morning NAB’s Ray Attrill explains why oil prices could continue to rise. Are we heading for $100 oil? Also, why bond yields are rising again ahead of an FOMC meeting this week where little is expected to happen. And troubling times for Boris Johnson, fighting the EU over the NI protocol, pacifying the US President and announcing a 4 week delay to next week’s planned lifting of all COVID restrictions. On today’s podcast we also look ahead to the RBA minutes, US retail sales and UK employment numbers. Hosted on Acast. See acast.com/privacy for more information.
14/06/2021 • 13 minutes 37 seconds
Market unphased by US CPI; ECB stays dovish despite upping forecasts
Friday 11th June 2021US CPI was a higher than expected, but the Market seems to have taken it largely in its stride, although it’s helped push equities higher today. NAB’s David de Garis said the market will be more interested in what the Fed might say next week, after a couple of disappointing payrolls numbers. Meanwhile, the ECB, upped their forecasts but didn’t talk of tapering, except to say they weren’t going to rush into it. And world leaders are in Cornwall to talk about the global approach out of the pandemic, including a belt and road initiative to rival Chinas. Hosted on Acast. See acast.com/privacy for more information.
10/06/2021 • 14 minutes 12 seconds
Inflation – mixed signals and opinions ahead of US CPI
Thursday 10th June 2021Bond yields have fallen further overnight, in some cases to levels not seen for several months. NAB’s Tapas Strickland says it could be market positioning, although it could also be related to growing acceptance that any inflation that occurs is transitory. That’s not how the Bank of England’s Andy Haldane sees it though, and China’s PPI numbers shows supply costs are rising. Yet the RBA’s Christophe Kent sees any significant rise in inflation, temporary or otherwise, as being some way off for Australia. This mix of views on where inflation is heading globally will be fuelled further by the latest US CPI number out later today. Plus, what to expect from the ECB. Hosted on Acast. See acast.com/privacy for more information.
09/06/2021 • 14 minutes 27 seconds
Markets going nowhere, yet US job openings boom
Wednesday 9th June 2021Inflation fears have eased further, says NAB’s Gavin Friend, with bond yields pushing lower and market volatility easing. That’s despite the JOLTs (job openings) numbers in the US which were high enough for everyone to have a job, but its clear to attract workers companies will have to lift their wages. That was evidenced in the NFIB small business survey overnight too. Meanwhile, in the UK the focus is on rising house prices – BoE chief economist Andy Haldane described the market as “on fire” – and the worsening dispute with the EU on the Northern Ireland border. The Europeans are worried that British sausages could find their way onto the continent, stopping them could also mean the Northern Irish could be sausage-free. This is a story that won’t go away. It’s a slow burner, with lots of sizzle to follow (sorry). Hosted on Acast. See <a style='color:grey;' target='_blank' rel='noopener noreferrer' href='https:/
08/06/2021 • 13 minutes 26 seconds
Goldilocks loses a little of her shine
Tuesday 8th June 2021If the non-farm payrolls gave the markets a Goldilocks moment on Friday – with jobs numbers that weren’t too hot or too cold – then maybe markets are already starting to question whether it was exactly what was needed. As NAB’s Ray Attrill points out, US CPI numbers later in the week, and the expectations of them, could tip the balance a little. But, could the speed of recovery also be a concern? The US is showing growth, and it’s likely the JOLTs numbers today will show there are lots of job openings, but will they be filled? And why are China’s exports down? Could it be to do with supply constraints, or could it be lack of demand, particularly when much of Asia is facing increasing lockdowns and restrictions. Hosted on Acast. See acast.com/privacy for more information.
07/06/2021 • 13 minutes 19 seconds
US jobs numbers hit the sweet spot
Monday 7th June 2021Not too good, not too bad, that seems to have been the market response to the non-farm payrolls numbers out of the US on Friday. NAB’s Rodrigo Catril says it reinforced the view that the labour market was recovering in the US, but not so fast that it would prompt tapering discussions. The result has been a sharp fall in Treasury yields and a pick-up in risk assets. It’s a different story in Canada, but as discussed in today’s podcast, it’s all a question of timing and lockdowns. The G7’s agreement in principle to a 15% minimum corporate tax was another highlight at the end of last week, but there’s still a long way to go. Hosted on Acast. See acast.com/privacy for more information.
06/06/2021 • 13 minutes 23 seconds
Taper torment with more calls for Fed to take their foot off the pedal
Friday 4th June 2021On today’s podcast NAB’s Gavin Friend talks through a session that has been in two parts. First off there was the response to a series of strong numbers from the US, including a standout set of employment numbers from the ADP. This positive news added to speculation that the Fed would taper soon rather than later, with the Fed’s Robert Kaplan suggesting they might need to take their foot off the pedal sooner. Stocks regained some of their losses when reports emerged that Joe Biden might compromise on the size of his increase to corporate tax. Tonight the focus will be on the non-farm payrolls numbers out of the US. If they are strong then pressure will mount for a swifter move from the Fed. Or at least that’s what the markets will expect. Hosted on Acast. See acast.com/privacy for more information.
03/06/2021 • 14 minutes 21 seconds
Beige Book highlights ‘brisk rise’ in input costs
Thursday 3rd June 2021If there’s one takeout from the Fed’s Beige Book overnight, aside from the continued improvement in the US recovery, it was the rising concern about input costs. Even though it’s seems to be accepted wisdom that price pressures from supply chain disruption will be transitory, there’s the question about how that disruption will impact the jobs recovery. NAB’s David de Garis says that makes this week’s non-farm payrolls on Friday particularly important, which explains why markets are lacklustre today, across almost all asset classes. Only oil is showing any significant move forward. Listen in for a description of how markets are travelling, just don’t expect any big numbers. Not today. Hosted on Acast. See acast.com/privacy for more information.
02/06/2021 • 14 minutes 35 seconds
No surprises from the RBA, and don’t be surprised by an uptick in Aussie GDP today
Wednesday 2nd June 2021The RBA didn’t steer from its earlier stance that it was too soon to be looking at any changes in policy right now. Those who were expecting a more hawkish attitude will have been disappointed. The real surprise yesterday was the strength of the GDP partials in Australia, in particular a record current account surplus. NAB’s Rodrigo Catril says that will translate to a higher GDP number today. Elsewhere, Europe posted final PMIs for May, which have been revised upwards, and the US reported a high ISM manufacturing read. Hardly surprising then, that oil is on the rise, with Brent hitting pre-pandemic levels. But with India still in trouble, Iran ready to up their production, and uncertainty over lockdowns the world over, isn’t $71 oil a little premature? Hosted on Acast. See acast.com/privacy for more information.
01/06/2021 • 12 minutes 39 seconds
China wants to curb the Yuan and grow the family
Tuesday 1st June 2021Markets have been understandably quiet with the US and UK on holiday. China delivered its PMIs, with the manufacturing read a little below expectations, and non-manufacturing a little higher than expected. NABs Tapas Strickland says the new orders component of manufacturing suggests demand might be starting to level off. The rising Yuan is clearly a concern for the PBoC who announced measures to tackle it, whilst Chinese authorities are now permitted families to have three children. Whilst Monday was quiet, there’s a plethora of data today, including pre-GDP partials for Australia, the Eurozone’s CPI, Canada’s GDP, US ISM, and China’s Caixin PMIs. Plus, of course, the RBA. No big announcements are expected but what will be the tone they adopt? Hosted on Acast. See acast.com/privacy for more information.
31/05/2021 • 12 minutes 49 seconds
Month end comes early for some
Monday 31st May 2021It was an early start to month-end on Friday, with the US and UK off on holiday today. NAB’s Ray Attrill says there were a lot of intra-day currency moves late in the day on Friday, some of which will be down to asset managers managing their hedge ratios. There was little movement in other asset classes, even with a higher-than-expected inflation read, mainly because it wasn’t the same scale as the CPI shock earlier in the month. It might be a quiet start to the week, but it’s a busy week, including the RBA tomorrow and non-farm payrolls in the US on Friday. Hosted on Acast. See acast.com/privacy for more information.
30/05/2021 • 12 minutes 12 seconds
More central bankers wanting to ease off the pedal
Friday 28th May 2021Three central bankers argued for a more rapid tightening of monetary policy overnight. The Bank of England’s Gertjan Vlieghe argued a scenario where rates in the UK could rise as early as Q2 next year, although NAB’s David de Garis says markets might have overreacted to what was a far more nuanced argument. The pound is the big winner in the major currencies overnight. The ECB’s Jens Weidman expressed concerns about monetary policy being pushed too far to tackle income distribution, whilst the Fed’s Robert Kaplan wrote an article outlining how the US labour market might be tighter than many have thought, with people stepping out of the workforce for early retirement, for example. Tonight, the Biden administration releases its budget papers, with forecasts, and the long awaiting PCE deflator – although with so much uncertainty around the transitory nature of inflation, or otherwise, there’s a question mark on just how valuable this read will be.<p style='co
27/05/2021 • 14 minutes 43 seconds
RBNZ talks it up, Europe talks it down
Thursday 27th May 2021The RBNZ surprised many yesterday by indicating that there could be an interest rate rise as soon as next year, which bolstered the Kiwi dollar and it hasn’t really come back down to earth. They are a little more guided in Europe, though, where the ECB mentions at every turn that tapering won’rt happen soon, let alone a rate rise. This morning Phil Dobbie asks NAB’s Rodrigo Catril whether two central banks can really pursue such different paths when the push comes to shove, particular as the RBA and RBNZ tend to be aligned? Hosted on Acast. See acast.com/privacy for more information.
26/05/2021 • 14 minutes 4 seconds
China gets Yuan Up on the Dollar
Wednesday 26th May 2021Okay, we know The US dollar has fallen again, with rises in the Euro, and a shift up in the Yuan, but will it stick? NAB’s Ray Attrill says there have been conflicting reports from China as to whether the country would benefit from a stronger currency, or not, but the belief is it will continue to rise which could add more strength to the Aussie dollar over time. In the US house sales were well down, but it seems to be a factor of supply shortages mixed with rising construction costs weakening demand. It’s being seen as another temporary inflation measure, with further falls ion bond yields overnight suggesting the transitory inflation story is even more widely accepted. Today the RBNZ policy statement – can they remain so dovish in light of the local data? Hosted on Acast. See acast.com/privacy for more informat
25/05/2021 • 14 minutes 18 seconds
Low volumes, more risk, less inflation concerns
Tuesday 25th May 2021Equities are back on the rise and bond yields are falling, slightly, as investors seem to have accepted the line of most central banks that inflation is only transitory. The Bank of England’s Chief Economist is one of the few dissenters, but as NAB’s Gavi Friend points out, he has always been hawkish, and he is about to walk out the door anyway. Nonetheless, the inflation debate continues and attitudes could quickly switch. Meanwhile, the Aussie dollar hasn’t gained as much as the NZ dollar from the weakening US dollar, in part because of more noises for China on the need to control speculation in commodities. Today Aussie merchandise trade figures, plus the weekly payrolls report, and the German IFO report. Hosted on Acast. See acast.com/privacy for more information.
24/05/2021 • 12 minutes 40 seconds
Lagarde’s tapering reluctance; vaccines winning against mutations
Monday 24th May 2021There was a strong set of numbers at the end of the week; PMI reads were generally good, UK retail bounced back and vaccines, we’re told, will do a good job against the current mutations of COVID-19. But the Euro lost ground on Friday as Cristine Lagarde refused to commit to any schedule for talking tapering, whilst support for tapering sooner rather than later is gathering some momentum in the US. Inflation continues to be a hot topic, with more evidence of rising costs in the PMIs. NAB’s Tapa Strickland says the survey highlights how many companies are expecting to pass the costs on. What will rising prices and a string economic recovery do for Biden’s hopes for a massive infrastructure spending program? Hosted on Acast. See acast.com/privacy for more information.
23/05/2021 • 13 minutes 40 seconds
It was another Turnaround Thursday
Friday 21st May 2021Equities bounced back in the US and Europe as markets re-evaluated the comments about the timing of tapering in this week's FOMC minutes. The US dollar is also lower, along with bond yields. NAB’s Gavin Friend points out that this is the third turnaround Thursday in a row. Will it become habit forming? On today’s podcast more discussion about differing attitudes to inflation, plus a look at yesterday’s job numbers in Australia and a look ahead to today’s flash PMI numbers for many parts of the world. Hosted on Acast. See acast.com/privacy for more information.
20/05/2021 • 13 minutes 18 seconds
Fed taper talk pushes yields higher
Thursday 20th May 2021The FOMC minutes gave away more than expected, with the Fed suggesting it might be appropriate at some point to discuss a plan to adjust the pace of asset purchases, if the economic recovery continues. Lots of caveats there, but markets responding pushing 10 year Treasury yields up 5 basis points quickly afterwards. NAB’s David de Garis says the mere mention of tapering was enough to evoke a response, with inflation also back in full focus. Also today, Bitcoin lost almost a third of its value, before making most of it back again, after China announced a ban on financial institutions facilitating any transactions into or out of the currency. There’s also discussion on today’s Aussie employment numbers – NAB is more bullish than consensus on this, expecting the unemployment rate today. Hosted on Acast. See acast.com/pri
19/05/2021 • 14 minutes 21 seconds
US dollar heading to 2018 lows
Wednesday 19th May 2021It’s been a mixed session for US equities overnight, whilst bonds headed sideways. The main move has been the further decline in the US dollar, falling below 90 on the DXY index for the first time since January and not far from the lows of 2018. NAB’s Gavin Friend says the move down is being driven by the reopening in Europe ,without the US labour market volatility, plus the fall in real yields. Also on today’s podcast, discussion on yesterday’s RBA minutes, tomorrow’s FOMC minutes and whether a US-Iran nuclear will add a sizeable chunk of extra oil on the global markets. Hosted on Acast. See acast.com/privacy for more information.
18/05/2021 • 12 minutes 8 seconds
Uncertain markets change direction again
Tuesday 18th May 2021US shares fell sharply today as investors once again weighed up inflation concerns. The only new data to support rising prices was the Empire State Manufacturing Index, which showed an all-time high for prices paid and future prices. NAB’s Tapas Strickland says it’s the tech sector that has been hit the hardest, perhaps because of overvaluation concerns and the fear of a Fed that has to raise rates aggressively if it’s behind the curve on inflation. Also on today’s podcast discussion of the RBA minutes later today, China’s retail numbers yesterday and the UK’s employment data later on today. Hosted on Acast. See acast.com/privacy for more information.
17/05/2021 • 12 minutes 21 seconds
Inflation, confidence and retail, merely temporary
Monday 17th May 2021Share markets are riding high again in the US despite a triple whammy of disappointing reports. First, retail sales ex-auto fell 0.8 percent in April, secondly consumer sentiment fell from 88.3 to 82.8, and finally inflation expectations have risen to the highest level in a decade. NAB’s Rodrigo Catril says investors are buying the Fed’s line that the recovery will see fluidity in numbers and rises in inflation are transitory. But we should also be looking at vaccination numbers, lockdowns and COVID infection rates to understand which economies will bounce back the fastest. Hosted on Acast. See acast.com/privacy for more information.
16/05/2021 • 13 minutes 31 seconds
Fewer jobless claims and hopes of a faster recovery
Friday 14th May 2021USA equities came bouncing back today after yesterday’s sharp response to the higher than anticipated CPI numbers. Topday, investors clearly decided to look beyond any temporary price rises and look to the great re-opening story. The news that there were less than expected jobless claims last week will have helped to drive the expectation that the worst is over and the US economy is reopening. That was reflected in the rise of cyclical stocks in particular and further evidence was provided in the New York Fed’s Weekly Economic Index. Today, eyes will be on the US retail numbers for April and the Michigan Uni Consumer Sentiment Index. Hosted on Acast. See acast.com/privacy for more information.
13/05/2021 • 11 minutes 46 seconds
The inflation shock we were warned about
Thursday 13th May 2021US CPI numbers came in on the high side today, and markets have reacted swiftly, with equities falling sharply and the bond sell-off pushing Treasury yields up, although not quite as high as late March when inflation fears were at fever pitch. Phil Dobbie asks NAB’s David de Garis whether the market is over-reacting. After all, it’s one month, it includes the base effect of last year’s lockdowns and the core number is not too far from the Fed’s target range. It could easily settle down in a month or two. The UK could be next to see this supply driven inflation ramp up, with the GDP numbers showing a significant rise in March, even before lockdown was fully eased. There’s only one focus for the markets right now and nobody is exactly sure how it will play out. Hosted on Acast. See acast.com/privacy for more informa
12/05/2021 • 13 minutes 39 seconds
Vertigo and Inflation Fears
Wednesday 12th May 2021Equities have taken a tumble again in the US, with the falls broader than just tech stocks. Europe too has seen sharp falls. This risk off mood is being driven by increasing inflation concerns, as evidence mounts that supply restraints are pushing up producer prices, which will eventually be passed on to the consumer. NAB’s Gavin Friend says vertigo is another factor, shares have risen so much this year that investors are worried. There’s also discussion on the Australian budget, China’s rising PPI numbers and why the rise in European bond yields this morning? Hosted on Acast. See acast.com/privacy for more information.
11/05/2021 • 13 minutes 57 seconds
Inflation, hugs and shrinking deficits
Tuesday 11th May 2021Inflation expectations continues to influence markets, with NAB’s Rodrigo Catril explaining why it has such a marked impact on tech stocks. Inflation in supply chains is a theme around the world, and tonight’s PPI numbers from China are expected to give another clear indication. The pound has had a string session as Britain prepares for more lockdown easing – and Boris Johnson promising the return of hugging – from next Monday. Locally, the focus will be the Federal Budget, and the implications for the RBA of a smaller deficit and less bond issuance. Hosted on Acast. See acast.com/privacy for more information.
10/05/2021 • 12 minutes 28 seconds
Does the US jobs shortfall vindicate the Fed’s cautious approach
Monday 10th May 2021US non-farm payrolls markedly undershot market expectations on Friday, with just 266 thousand new payrolls, versus the expectation of close to one million. NAB’s Tapas Strickland says some argue that the $300 a week jobless supplement is delaying the return to work. Nonetheless, investors took it as a sign that government stimulus would continue and that the Fed’s program would continue on schedule, with no moves until a string of months with strong recovery in jobs numbers. In Australia all eyes will be on the revised government deficit in the Federal Budget tomorrow. Can the RBA continue with the current scale of bond buying if the government is issuing less of them? Hosted on Acast. See acast.com/privacy for more information.
09/05/2021 • 13 minutes 18 seconds
Let’s not get carried away
Friday 7th May 2021The Bank of England has upped its forecasts for the growth of the UK economy this year – from 5 percent a few months ago, up to 7.25 percent. The recovery is booming, it seems, but let’s not get carried away, said BoE Governor Andrew Bailey. NAB’s David de Garis looks at the implications of the new forecast on their policy decisions moving forward. The RBA has also been in the spotlight, with Guy Debelle talking in Perth last night and suggesting that inflation forecasts were of less interest to the bank than the inflation that was actually being experienced. Tonight non-farms payrolls will be the focus in the US, where the economy is also bouncing back and jobs will be part of it, but just how quickly? Hosted on Acast. See acast.com/privacy for more information.
06/05/2021 • 13 minutes 51 seconds
Will the Bank of England taper before the Fed?
Thursday 6th May 2021The Fed’s board continues to talk down the prospect of tapering, pushing the argument that price rises will be transitory. There was more evidence of prices being hit by supply chain issues in the services ISM numbers in the US this morning. It might be a different story in the UK. NAB’s Gavin Friend says its line ball as to whether the Bank of England will highlight the prospect of tapering this year. Guy Debelle might add some thoughts on the timeline for the RBA’s bond buying when he talks in Perth this afternoon. The UK also goes to the polls today, with the question of whether an increase in the SNP vote could force the case for another Scottish independence referendum. Hosted on Acast. See acast.com/privacy for more information.
05/05/2021 • 13 minutes 1 second
Yellen’s Rates Call Surprises, RBA ups forecast
Wednesday 5th May 2021Janet Yellen surprised the markets this morning suggesting that it might be necessary to raise interest rates to stop the economy from overheating. A call to be made by the Federal reserve, not the Treasury Secretary. Initial market reaction was paired back as the reading of the intent and timing of the comments was watered down. Meanwhile, shares fell in the UK and Europe, although big -tech fared worse than cyclicals. The RBA has upped their growth forecasts for Australia, and cut their unemployment rate expectations, whilst the RBNZ’s Financial Stability Report will be looked at with keen interest to see the influence of a housing market running hot. Hosted on Acast. See acast.com/privacy for more information.
04/05/2021 • 14 minutes 58 seconds
Demand beating supply. Inflation anyone?
Tuesday 4th May 2021Demand is outstripping supply on both sides of the Atlantic. That fact shone through in today’s US manufacturing ISM, which, whilst still well over 509, at 60.7 it is quite a bit down on March, with a rising number of backorders and increasing material costs. It’s a similar story in Europe, where manufacturing PMIs for April have been revised down a little. NAB’s Rodrigo Catril says there is little doubt that inflation is coming, the question is, for how long and how deep? The RBA meets today, their statement will foreshadow the forecasts in Friday’s Statement on Monetary Policy. Hosted on Acast. See acast.com/privacy for more information.
03/05/2021 • 12 minutes 36 seconds
A bad end to a solid month
Monday 3rd May 2021What data there was on Friday was largely good news, apart from the horrific turn of events in India. In the US, though, reads on consumer sentiment and Chicago’s PMI came out stronger than expected. Yet markets turned a little sour at the end of the week, with equities sharply down, and commodity prices falling. NAB’s Tapas Strickland says month-end positioning will be partially to blame, along with concerns about market valuations. Another positive indicator for the US was a 21 percent surge in personal income in the US. Will this flow through to stellar GDP growth in Q2, and if so, what does this do t the prospects for Biden’s next stimulus package or for the Fed’s resistance to tapering? Hosted on Acast. See acast.com/privacy for more information.
02/05/2021 • 14 minutes 25 seconds
The price of supply chain disruption
Friday 30th April 2021It’s been a choppy session for US stocks, even though the news on the economy was largely positive and earnings results have been strong. Still, equities generally pushed higher, with the S&P500 getting over the 42,000 level. Commodities have also been rising sharply, with copper breaking $10,000 momentarily. NAB’s David de Garis talks about how supply chain issues are pushing prices higher, particularly the supply of chips which is slowing car production in the US AND Japan. Commodities generally are impacting the prices paid for producers the world over. The big questions is, how long will this go on for? Hosted on Acast. See acast.com/privacy for more information.
29/04/2021 • 12 minutes 44 seconds
Long ways to go, says Powell
Thursday 29th April 2021Excuse the American pluralisation, but “long ways to go” is the Fed’s Jerome Powell’s take on the path to recovery for the American economy, and the reason that rates won’t be lifting anytime soon, and the easing of bond purchases are, supposedly, also some way off. There were small movements in the market, says NAB’s Ray Attrill, mostly from the press conference rather than the FOMC statement. Also today, why housing subsidies partially account for Australia’s lower than anticipated CPI numbers yesterday. Plus, the problem with the US’s rising trade deficit, and how we can expect Australia’s terms of trade to rise even more later today. And the first look at earnings results for Apple and Facebook. Spoiler alert, both very strong. Hosted on Acast. See acast.com/privacy for more information.
28/04/2021 • 14 minutes 55 seconds
Treading water, but inflation expectations are on the rise again
Wednesday 28th April 2021Markets are treading water ahead of the FDOMC meeting tomorrow morning, but there’s been a sudden rise in bond yields in the US which, NBA’s Rodrigo Catril, suggests inflation is still a concern, as optimism around a vaccine driven recovery escalates. But inflation is less of a concern in Australia - we get the CPI numbers today, Rodrigo tells us what to expect. There’s also discussion around what the Fed will say tomorrow morning, and why share prices aren’t always responding to earnings results which are generally beating expectations. Tesla, Microsoft and Alhabet are the latest to outperform. Has the market reached a peak for now? Hosted on Acast. See acast.com/privacy for more information.
27/04/2021 • 14 minutes 30 seconds
Reflation reigns for now
Tuesday 27th April 2021Equities are on the rise again as risk sentiment rises following largely positive data, including the PMIs talked about in yesterday’s Morning Call. Data over the last 24 hour shas been a little more subdued, with Germany’s IFO survey pulled down by lower expectations, and the US durable goods orders softer after the cancellation of Boeing aircraft orders. Nonetheless, the mood is generally positive, says NAB’s Gavin Friend, with Europe now getting into gear on vaccination rollouts and most S&P companies I the US have beaten their earnings estimate and copper – which is tied to the global reflation trade – is now at a decade high. The stars are aligned, for now, but the situation in developing nations – and in particularly in India – are a stark reminder that the problem won’t go away until the disease is tackled everywhere. Hosted on Acast. See <a style='color:grey;' target='_blank' rel='noopener noreferrer' hre
26/04/2021 • 12 minutes 38 seconds
Risk on, for how long?
Monday 26th April 2021Markets were on a positive frame of mind at the end of the week, with a strong set of PMIs in the US and Europe, which helped push equities still higher in America. But how much is too much? Phil Dobbie asks NAB’s Tapas Strickland whether some of this is being driven by a fear of missing out. Meanwhile, with all the positive news, how long can the Fed continue to argue the need for such high levels of bond purchases and years of low interest rates? Will there be any hint that a change in direction is even being considered, when the Fed meet this week? Hosted on Acast. See acast.com/privacy for more information.
25/04/2021 • 11 minutes 56 seconds
ECB avoids taper-talk, Biden’s rumoured tax grab
Friday 23rd April 2021Shares in the US have fallen this morning on news of a sizeable hike in capital gains for wealthy Americans. Although not officially released, NAB’s Gavin Friend explains how the rumour was enough to send shares falling, after a fairly positive start to the session. The ECB was asked whether they would follow Canada’s lead in tapering bond purchases sooner, but there won’t be anyu change until the June 10th meeting. Then the ECB might change its approach, depending on progress on containing the virus. Todays, it’s a day for PMIs, with the flash numbers for April for the Eurozone, Germany, the UK and the US. Hosted on Acast. See acast.com/privacy for more information.
22/04/2021 • 12 minutes 54 seconds
Hawkish BoC boosts Canadian dollar
Thursday 22nd April 2021The Canadian dollar has been boosted by the Bank of Canada markedly increasing their growth forecasts for this year, bringing forward the expected date of rate rises and introducing tapering from next week. NAB’s David de Garis says markets were expecting a tapering announcement, but were taken by surprise by the size of the growth revision, with the country in the midst of the third wave of the pandemic. On the podcast today we also look at New Zealand’s CPI read and what it can tell us about Australia’s inflation numbers next week, plus we look ahead to the ECB meeting tonight. And yesterday’s Australian retail numbers was largely a rebound in growth for WA and Victoria, but it seems cafes and restaurants may have led the charge. Is Australia heading for an avocado on toast led recovery? Hosted on Acast. See acast
21/04/2021 • 13 minutes 50 seconds
Market cautious over speed of recovery
Wednesday 21st April 2021There’s a cautious mood in the markets right now, with US stocks down, with smaller caps hit particularly hard. NAB’s Ray Attrill discusses whether this is all down to a revaluation of the speed of the economic recovery. Could the tightening of credit be responsible for this? It’s hard for businesses to recover without borrowing. There’s also discussion of yesterday’s RBA minutes and the expectations for Australia’s retail numbers out this morning. Hosted on Acast. See acast.com/privacy for more information.
20/04/2021 • 13 minutes 41 seconds
Wall Street pulls back during a quiet session
Tuesday 20th April 2021US equities dipped a little overnight, pulling back from record highs. NAB’s Tapas Strickland says there does seem to be a habit for a selloff whenever equities climb above the S&P500 200-day moving average. Will it all bounce back? Well, the vaccine news remains positive, with big reductions on cases in countries where vaccines have been rolled out extensively. That’s why we’re seeing strength in the Euro and Sterling today. But what about the Aussie dollar? Is it losing its momentum? It’s another quiet day ahead, with the RBA minutes not expected to reveal much, and earnings results for United airlines and IBM. Plus Apple are announcing something new. Hosted on Acast. See acast.com/privacy for more information.
19/04/2021 • 11 minutes 40 seconds
Bitcoin stalls, but US economy set to rip
Monday 19th April 2021There’s still plenty of positive sentiment around as the US, UK and Europe continue to vaccinate at pace. Europe has picked up pace and now jabbed 20 percent of its adult population. The Fed’s Christopher Waller said the economy is “set to rip”, with 6.5 percent growth this year. Yet, despite all the positive news, we have been seeing a decline in bond yields. In today’s Morning Call NAB’s Rodrigo Catril suggests it might be because concerns over inflation have been overdone and the market is coming round to the message that the Fed is trying to deliver that any rises will be transitory. Bitcoin dropped 15 percent in value on Friday, with unsubstantiated reports that the US might be clamping down on money laundering. Today is fairly quiet for data releases, with US earnings reports the only numbers of any consequence. Hosted on Acast. See <a style='color:grey;' target='_blank' rel='noopener noreferrer' href='http
18/04/2021 • 11 minutes 26 seconds
Topsy Turvey Response to a Good News Day
Friday 16th April 2021The news was largely positive overnight. Retail sales in the US were better than expected, initial jobless claims were down, the Philly Fed and Empire Manufacturing Surveys were strong – yet bond yields fell sharply in the US, spreading across much of Europe. It’s not the response you’d expect. NAB’s Ray Attrill says bond analysts had been expecting a period of consolidation, but perhaps not quite so much in one day, particularly surrounded by such positive economic data. The Aussie dollar has been one beneficiary of the positive sentiment surrounding that data, and there could be more to come if the numbers out of China are strong, including Q1 GDP, March Industrial Production, Retail Sales and Fixed Asset Investment, all out later on today. Hosted on Acast. See acast.com/privacy for more information.
15/04/2021 • 12 minutes 29 seconds
Earnings up, Aussie confidence on a roll, oil shoots higher
Thursday 15th April 2021Equities came back off the highs we saw on Tuesday/Wednesday, but their decline didn’t reflect the sentiment in the market. In fact, a four percent rise in oil has been a better indicator, along with the strength of the Aussie dollar. NAB’s David de Garis says we have sen a rotation out of the tech stocks, but the banks have generally been doing well, helped by better than expected earnings results. Our local currency has been bolstered by yesterday’s consumer confidence read, with high hopes for today’s employment data for Australia. Today there will be a lot of attention paid to US retail sales – will they add to the positive vibes? Hosted on Acast. See acast.com/privacy for more information.
14/04/2021 • 13 minutes 19 seconds
Vaccine slow down and inflation signs
Wednesday 14th April 2021It’s been a session with mixed messages. Inflation is showing up in data, including higher than expected CPI in the US yesterday. We’re seeing it in input prices in the NAB Business Survey too, Of course central banks continue to say that any rise will be transitory, but are the markets convinced? Meanwhile, the global recovery that will give rise to that inflation could be temporarily stalled as the Johnson and Johnson vaccine deployment has been halted in the US and in Europe, where it was is expected to inoculate a quarter of all adults. Phil Dobbie talks to NAB’s Rodrigo Catril about the day’s market action. Hosted on Acast. See acast.com/privacy for more information.
13/04/2021 • 12 minutes 43 seconds
US CPI today; all jabs are not equal
Tuesday 13th April 2021It’s been a fairly quiet session overnight, with bond auctions garnering a little less interest than last time, and more to come today. We also get CPI numbers for the US today. NAB’s Ray Attrill says the market is well prepared for a big jump in the yearly reading, but a significant upside surprise could raise questions about how transitory the rises are. Fed’s Bullard spoke about the potential to look at tapering of asset purchases when the US vaccine rate reaches 75% of the population. That’s assuming having the jab results in lower infection rates – Brazil is struggling to contain an outbreak after rolling out a vaccine with a low efficacy rate. NAB’s Business Survey is out today as well. Hosted on Acast. See acast.com/privacy for more information.
12/04/2021 • 13 minutes 8 seconds
New highs, fast jabs and more inflation brush off
Monday 12th April 2021Equities in the US finished Friday on new highs, ahead of corporate earning this week and despite a rise in bond yields. NAB’s Tapas Strickland says a lot of the optimism is being driven by vaccine optimism, as President Biden once again brings the dates of his vaccine targets forward. The spectre of rising inflation continues to hang over markets, particularly as PPI prices rose last week. But Jerome Powell sued his 60 minutes appearance on US TV to again make the point that any rise in inflation would be transitory. Nonetheless, a poll of economists are expecting a rate rise at least a year ahead of the Fed’s schedule. Aussie jobs data will be a focus this week, along with China’s aggregate financing data. Hosted on Acast. See acast.com/privacy for more information.
Friday 9th April 2021Australia has become the latest nation to express concern about the use of the Astra Zeneca vaccines on young people, except here young is anyone under 50. N AB’s Tapas Strickland says it’s unlikely to slow down the speed of the vaccine rollout, but it could have consequences in Europe. Jerome Powell offered little new when he spoke on an IMF panel overnight, talking down the prospect of sustainable inflation. But the ANZ business survey for New Zealand showed rising inflation expectations. Phil Dobbie asks, what does the RBNZ do if inflation is maintained above its target rate, whilst the rest of the world doesn’t? And CPI numbers of China will be worth looking out for later today. Hosted on Acast. See acast.com/privacy for more information.
08/04/2021 • 12 minutes 5 seconds
Markets Lacklustre, Unsurprising FOMC minutes
Thursday 8th April 2021It’s been one of the quietest sessions for some time. The FOMC said nothing that surprised markets, and Janet Yellen detailing how they would pay for the $2.25 trillion infrastructure package was met with a similar muted response. NAB’s Gavin Friend suggests the markets are considering a bit of rebalancing, particularly when it comes to Europe. Even if they are slower to recover the difference between the US and Europe will only be a few months. The destination is the same. The pound struggled today as an announcement was made about limiting use of the Astra Zeneca vaccine for the under thirties. Generally, though, the word ‘lacklustre’ sums up market action overnight. Sadly, the only currency to see significant losses was the Aussie dollar. Hosted on Acast. See acast.com/privacy for more information.
07/04/2021 • 11 minutes 49 seconds
Consolidating and vaccinating
Wednesday 7th April 2021There were no significant market moves overnight. The US dollar has fallen a little further, bond yields are down and equities have cooled somewhat. NAB’s David de Garis says, maybe markets are taking Jerome Powell’s words to heart that it’s a long road ahead and the Fed is going to stay the course. That’s certainly the line echoed by the RBA yesterday even though, like the US, the news is largely positive. Vaccination rates continue to be a determinant of economic recovery, with Canada’s President Trudeau announcing a third wave on his home soil, where the number of people having the jab remains very low. FOMC minutes are out tomorrow; we’ll talk about those, hot off the press, tomorrow morning. Hosted on Acast. See acast.com/privacy for more information.
06/04/2021 • 13 minutes 7 seconds
US bounce pushes equities to record highs
Tuesday 6th April 2021US equities have been boosted by a string of positive data. The ISM manufacturing read at the end of last week bounced back sharply, and the services number reached a new record high this morning. Plus, non-farm payrolls on Friday also punched the lights out. NAB’s Ray Attrill says even though shares responded, Treasury yields are actually lower than they were before this swathe of positive numbers and the US dollar has fallen, indicating it is responding negatively to risk sentiment at the moment. Today the RBA meets, job vacancy numbers are out for Australia and the Caixin Services PMI is out in China. Hosted on Acast. See acast.com/privacy for more information.
05/04/2021 • 12 minutes 59 seconds
Markets Rally Ahead of Biden’s Philly Talk
Thursday 1st April 2021Joe Biden and Treasury Secretary Yellen are about to give the details of their long-awaited infrastructure spending plan, but NAB’s Tapas Strickland tells Phil Dobbie that most of the detail has already been released. And the response to the markets has clearly been favourable, with share prices reaching new highs overnight. Bond yields have also been rising. They also discuss Australia’s residential building approvals, US jobs data and China’s rising PMIs. Tapas explains how a slower recovery in Europe could actual be good for the Chinese economy. Hosted on Acast. See acast.com/privacy for more information.
31/03/2021 • 14 minutes 15 seconds
Biden the builder
Wednesday 31st March 2021US 10 year Treasury yields hit a 14 month high overnight, as the US dollar rose higher. Phil Dobbie asks NAB’s Ray Attrill how much of today’s movement can be attributed to end of month and end of quarter rebalancing? And how much of a reaction can we expect after Joe Biden announces his infrastructure plan later tonight – which could cost anything from US$2.2 to 4 trillion. There are plenty of moving parts to influence markets, from the total size of the package to how it will be funded – government debt or taxation. There could also be a response to jobs numbers from the US today and on Friday. The Fed’s Raphael Bostic has predicted a million jobs a month over summer, if that happens sooner it could put pressure on bond yields over the long weekend. Hosted on Acast. See acast.com/privacy for more information.
30/03/2021 • 14 minutes 9 seconds
Open for business
Tuesday 30th March 2021NAB’s Gavin Friend says, early in the session the fire-sale of $20 billion of stocks held by Archegos Capital was all everyone was talking about. But, as it became clear there was little further contagion, attention shifted to the floating of the Ever Given and the easing of lockdowns. The focus now, he says, is on price pressures, starting today as German reports preliminary inflation numbers for March. There will be a lot of attention focused on Joe Biden’s infrastructure proposal, with reports that the total spend could be as much as $4 trillion. Weekly Australian payrolls numbers are out today, but Thursday’s job vacancies data will garner much more interest. Hosted on Acast. See acast.com/privacy for more information.
29/03/2021 • 12 minutes 45 seconds
Optimism, despite block trades and blocked trade
Monday 29th March 2021There was quite a bit of optimism in the air on Friday as we career towards the end of the month and the end of the quarter this week. NAB’s David de Garis says this could account for some of the volatility we saw at the end of the week, with Goldman Sachs selling off $10.5 billion in stocks. Nonetheless, shares were up after a late in the session rally, which carried through to Asia. So, could there be more volatility in this shortened week? There will be a lot of attention on jobs numbers (in Australia and the US), whilst the blockage in the Suez will cause supply concerns. An attempt late Sunday to float the stranded vessel failed and now it seems the only way forward is to start removing containers, which will take time. Hosted on Acast. See acast.com/privacy for more information.
28/03/2021 • 14 minutes
Mixed sentiment sees markets move sideways
Friday 26th March 2021It’s been another mixed session. NAB’s Gavin Friend says, on the one side there’s the tantalising prospect of an economic reopening in the northern hemisphere that is almost touchable, but there’s also the issues around vaccine production and, in Europe, concerns about how many people are prepared to take it. Equity markets are subdued, with another move away from tech stocks. Interest in the 7 year bond auction in the US was better than last time, but still cautious. Whilst most Fed speakers reiterate that, even though economic growth might be higher than expected by the year end, interest rates won’t budge till 2024, although Bostick predicts a much shorter timescale. Jo Biden, meanwhile, has doubled his forecast for the number of jabs in American arms in his first 100 days in office. And oil prices rose again as the Suez Canal remains closed, possibly for days, maybe even weeks. Hosted on Acast. See <a style='c
25/03/2021 • 14 minutes 58 seconds
A wedged ship, vaccine wrangles add to delay concerns
Thursday 25th March 2021There’s a realisation emerging, says NAB’s Gavin Friend, that even though countries are pressing ahead with vaccine role outs, the speed of recovery might be slower than envisaged. The political wrangles over vaccines supplies from the EU have added to this feeling, with a risk-off mood returning slowly to markets. Oil rose sharply as an oversized ship has blocked the Suez Canal – expectations that it might quickly be moved have gone because, well, it’s still there. There’s a lot of bonds being auctioned in the US in the next 24 hours to keep a watchful eye on, and Joe Biden gives his first press conference, focusing on geopolitics and the Build Back Better infrastructure plans. Hosted on Acast. See acast.com/privacy for more information.
24/03/2021 • 13 minutes 49 seconds
Oil price spills over COVID recovery concerns
Wednesday 24th March 2021Market sentiment has switched in the last 24 hours, with concerns that the economic recovery from COVID-19 might be slower than anticipated. The airline industry will feel some of the hurt, with European summer holidays likely to be off the agenda for most Brits. Janet Yellen and Jerome Powell were also guarded in their comments about the pace of recovery in the US, when they spoke to the House Financial Services Committee. The New Zealand dollar was the currency hit the hardest. NAB’s David de Garis says much of the fall is to do with government measures to try and restrict house price inflation, moving demand from investors to home buyers. Watch the PMIs tonight for signs of a widening gap between the European and UK economies, as Britain takes the jab many times faster than their cousins over the channel. Hosted on Acast. See <a style='color:grey;' target='_blank' rel='noopener noreferrer' href='https://acas
23/03/2021 • 14 minutes 26 seconds
US bond yields fall; risk sentiment boosts equities
Tuesday 23rd March 2021There were big rises in US shares overnight, with the NASDAQ rising 1.7% in this session, helped by a moderate fall in Treasury yields. NAB’s Tapas Strickland says news of a higher than expected infrastructure spending plan also helped boost equities. Reports suggest as much as $3 trillion will be spent, a mere $1 trillion more than had been anticipated. Trials of the Astra Zeneca vaccine in the US also came up with very positive results, which could lead to approval, with the bonus of perhaps encouraging more Europeans to take the vaccine. The slow rollout is adding to the number of new cases in Europe and in parts of the US, which could slow the speed of economic recovery. Hosted on Acast. See acast.com/privacy for more information.
22/03/2021 • 14 minutes 12 seconds
SLR and all that
Monday 22nd March 2021The Fed will push on with ending its lower capital requirements held against Treasurys, sticking with a schedule that will see the so-called supplementary-leverage ratio (SLR) ending on 31st March. Although not unexpected, NAB’S Rodrigo Catril says it risks weakening the appetite for bonds at a time when there is a much higher issuance doing down the pipeline. He explains why markets calmed down a little later I the Friday session. Today we can expect some response to President Erdogan’s decision to sack Turkey’s central bank governor for having the temerity to raise interest rates. Otherwise, it could be a fairly quiet start to the week. Hosted on Acast. See acast.com/privacy for more information.
21/03/2021 • 13 minutes 31 seconds
Fed pushes bond yields up, Russia drives oil down
Friday 19th March 2021There was more reaction to the FOMC meeting today, with bond yields rising sharply. Oil has also risen a lot as tensions mount between the US and Russia. Biden referring to Putin as a “killer” doesn’t seem to have gone down too well, and now with the threat of sanctions from the US there are fears Russia will up oil production in response to impact the US shale oil industry. The Bank of England followed the same script as the FOMC overnight, expecting a faster recovery but, just like the Fed, they are going to let the economy run hot before they contemplate a rate rise. As NAB’s David de Garis points out, the UK would relish the idea of the economy running hot anytime soon. In Australia labour market data was a big upside surprise, with unemployment down to levels not forecast to be reached for a year. Perhaps today’s retail numbers will also be welcome news. Hosted on Acast. See <a style='color:grey;' target='_bl
18/03/2021 • 13 minutes 50 seconds
Strong market reaction as Fed changes nothing
Thursday March 18th 2021The Fed has upped its growth expectations for the US economy, driven by the fiscal support and the vaccine rollout. But Fed Chair Powell says they are still expecting to keep interest rates low through to 2023, and they are not even talking about starting to talk of tapering of their QE activity anytime soon. He also said inflation was expected to pick up in the shorter term, but this would be transitory. Phil Dobbie asks NAB’s Gavin Friend whether the markets are convinced on this. Plus, what to except from NZ GDP this morning, and Australia’s labour market data from the ABS today. Hosted on Acast. See acast.com/privacy for more information.
17/03/2021 • 13 minutes 42 seconds
Slow movement, soft data
Wednesday 17th March 2021There wasn’t much movement in shares, bond yields or currencies overnight, despite weaker retail numbers out of the US. It’s a different story for Australia with strong jobs data yesterday ahead of the official ABS Labour market data later in the week. NAB’s David de Garis says the RBA has suggested that many big companies have already made their adjustments on employment levels ahead of the end of JobKeeper, so there is a reduced risk of any sort of shock as the scheme closes. Hosted on Acast. See acast.com/privacy for more information.
16/03/2021 • 14 minutes 18 seconds
Clots slow down the EU vaccine rollout
Tuesday 16th March 2021The fear of blood clots from injections means use of the Astra Zeneca vaccine has been suspended in an increasing number of European countries, slowing down the rollout, whilst the UK pushes ahead, reaching almost 40 percent of the population so far. This issue of lagging behind is not just impacting the economy, but is also playing into the strength of the Euro, says NAB’s Rodrigo Catril. Generally though it’s been a quiet session, with minimal movement sin bond yields, shares and currencies, ahead of the FOMC meeting later in the week. Hosted on Acast. See acast.com/privacy for more information.
Monday 15th March 2021Bonds yields rose sharply again on Friday, with 10 year Treasuries reaching their highest level since February last year. NAB’s Tapas Strickland says the inflation break-even component actually fell slightly, as the Michigan Consumer Sentiment survey showed inflation expectations had fallen slightly. Meanwhile the cyclical rotation theme continues as the vaccination rollout accelerates in the US and UK. It’s a different story in Europe, of course, with Italy returning to lockdown today as infection numbers rise sharply, with Germany heading in the same direction. The FOMC will be the main focus this week, along with Aussie retail sales and employment numbers. Hosted on Acast. See acast.com/privacy for more information.
14/03/2021 • 13 minutes 42 seconds
ECB to buy faster, US job claims slowing
Friday 12th March 2021Asset markets continue to be drawn by bond markets, says NAB’s David de Garis, on today’s podcast. With stimulus coming down the line, and jobs data showing further signs of recovery, you might have expected increased inflation concerns, but yesterday’s CPI figures seem to have calmed those concerns for now. But the ECB is still kicking into action, promising a faster bond buying spree under its pandemic emergency purchase programme, with Christine Lagarde concerned about the rate of recovery. Europe, of course, continues to suffer from a slow vaccine rollout – reaching 10% of the population in France so far, compare to 36 percent in the UK. Britain’s trade numbers will be interesting today, not because of COVID, but to se the impacts of Brexit on trade with Germany and the rest of Europe. Hosted on Acast. See acast.c
11/03/2021 • 13 minutes 9 seconds
Low US inflation, Lowe’s go slow, China borrows to grow
Thursday 11th March 2021The US 10 years notes auction this morning was a little softer than anticipated, but saw yields higher than last time. But NAB’s Gavin Friend says the story of the day was really the softer US inflation numbers, which saw yields pull back and helped stocks rise, with more rotation away from tech stocks. Meanwhile Philip Lowe from the RBA has been pushing back on market pricing, suggesting rates won’t rise until 2024, saying they would need to see wage gains sustainably above three percent. Whilst the RBA concerns are growing pains, the ECB has a different issue, says Gavin, because of their delayed response to the vaccine. Hosted on Acast. See acast.com/privacy for more information.
10/03/2021 • 10 minutes 40 seconds
Another big share flip and a boost in Aussie business confidence
Wednesday 10th March 2021Shares have reverted to a focus on tech in the US with a sharp rise in tech stocks. In fact, almost everything is a reversal on yesterday, with the US dollar weakening, the Aussie dollar strengthening, and bond yields falling. Chinese shares have stopped their decent, perhaps the alleged injection of cash from the government worked, for now. The expectation that the global recovery will be strong was reinforced by revised OECD forecasts and a record high for business confidence in yesterday’s NAB Business Survey. The inflation fixation right now means all eyes will be on