Asian share markets are seeing a strong bid led by Japanese markets as they return from their long weekend with traders all waiting in anticipation of tonight’s US CPI print that is now becoming as important as the jobs print on the economic calendar. Not much movement in currency-land with the RBA cutting rates 25bps
As expected, the Reserve Bank of Australia (RBA) cut the official cash rate by 0.25% to 3.60%. The decision was unanimous among board members. In its media release accompanying its decision, the RBA noted that “inflation has continued to moderate”, down “substantially since the peak in 2022”. It also signalled further “gradual” rate cuts ahead.
Economist Ross Gittins from the SMH has pilloried the Productivity Commission’s (PC) proposal to cut Australia’s company tax rate to 20% for all but the largest 500 firms with annual turnovers of $1 billion, alongside introducing a 5% tax on the annual net cash flow of all companies. The two sets of general equilibrium models
The mind control underway in the Australian government today is something to behold. I have repeatedly drawn attention to the RBA’s systematic erasure of the word “immigration,” which has completely trashed its credibility because it can’t forecast anything accurately if it does not make reference to the number one input into Australian macro. Now, the
The Market Ear on the great AI inflation. “Lagom” – not too hot, not too cold Here’s the must-see flow & positioning data from the weekend — a continuation of the “Lagom” theme: not too hot, not too cold. Continued hedge funds de-risking and strange record Russell shorts meets continued systematic and retail buying. De-grossed
Bloomberg sees an endless Chinese property crash. Developer China South City Holdings Ltd. was ordered to liquidate by Hong Kong’s High Court, making it the biggest Chinese builder by assets to be wound up since China Evergrande Group. Always hopeful, Bloomberg also sees another bottom for Chinese property. Authorities are mulling more intervention. They have been considering
Out of all nations on earth, Canada is arguably the most similar to Australia. Both nations are resource-rich, hosting relatively small populations on massive landmasses. The overwhelming majority of the population lives in small pockets where the weather is most favourable. The bulk of Australia’s population lives on the East Coast, whereas the bulk of
The ferrous complex continues typical seasonal trading. This is all rather silly. Bloomberg. Iron ore gained after a Chinese consultancy said several steel mills had been told by authorities they will need to temporarily halt production later this month due to air pollution concerns.\ I know the market likes to be contrarian, but steel cuts
In the world of United States economics, it has been said that “the construction cycle is the economic cycle”. Looking at the data, there is certainly a degree of truth to that, with the number of homes under construction peaking and then falling significantly prior to 4 of the last 6 non-pandemic-related recessions. Perhaps the
New Zealand’s economy continues to struggle. The nation’s labour market has seen unemployment and underutilisation rates soar to near-decade highs outside of the pandemic. New New Zealand has lost close to 40,000 jobs since late 2023, with younger workers bearing the brunt. Unofficial labour market indicators, including SEEK’s job ad and applications per job ad