NAB Morning Call

Wednesday 7th February 2024NAB Markets Research Disclaimer Financial Services Guide | Information on our services - NABIt was a busy day for Australia yesterday, with the RBA announcement, the statement of monetary policy, and the press conference. For all of that there wasn’t any wild fluctuations in markets, despite the hawkish tilt and the spectre of a rate rise given as one possible course of action if services inflation remains too resilient. But, as NAB’s Gavin Friend points out, most of the market action was in US bond markets, where yields fell significantly overnight. It’s the lack of tier one data, says \gavin, driving speculation.  Hosted on Acast. See acast.com/privacy for more information.

Tuesday 6th February 2024NAB Markets Research Disclaimer Financial Services Guide | Information on our services - NABStronger than expected ISM services data yesterday has dampened further the likelihood of a March rate cut. Meanwhile, China is taking more steps to stem the outflow from equity markets. Australia, meanwhile, readies itself for the first RBA announcement of 2024. But its not just an announcement, it’s the release of the Statement on Monetary Policy and a press conference. NAB’s Rodrigo Catril talks us through this new look RBA performance and why it could prove to be choppier for bond and currency markets. Hosted on Acast. See acast.com/privacy for more information.

Monday 5th February 2024NAB Markets Research Disclaimer Financial Services Guide | Information on our services - NABUS payrolls numbers on Friday showed a surprisingly large upswing, mirroring the ADP numbers earlier in the week. The data also showed a higher-than-expected increase in wages. NAB’s Ken Crompton says this puts paid to any hopes of a March rate cut, with the first fully priced cut expected in June. He adds there’s a chance that inflation data could be revised up a little later this week. The BoE’s Huw Pill meanwhile has been promoting the need to wait longer before cutting, adding to the underperformance of Gilts on Friday. It’s a quiet start to the week, but the main interest locally is obviously the RBA tomorrow, with the rates announcement coinciding with the publication of the Statement of Monetary Policy, followed by a press conference by Michele Bullock. A lot to take in.  Hosted on Acast. See acast.com/privacy for more information.

Friday 2nd FebruaryPlease note this communication is not a research report and has not been prepared by NAB Research analysts. Read the full disclaimer here.Sydney and Melbourne property prices are down from their peaks, whilst Brisbane, Adelaide and Perth reached all time highs last month. But for how long? Will Sydney and Melbourne bounce back? Phil talks to Eliza Owen Core Logic’s Head of Residential Research about recent trends in the property market which, despite everything, continues to enjoy rising prices, but for how long? What impact is migration having on demand for dwellings in Sydney and Melbourne. What’s driving the widening gap between house prices and apartments? And what are the trends Eliza thinks we’ll see this year that might surprise you. Even if you are not a property investor, or considering a housing purchase, this is compulsory listening for anyone gathering ammunition for Australia’ favourite dinner party conversation – house prices! Hosted on Acast. See acast.com/privacy for more information.

Friday 2nd February 2024NAB Markets Research Disclaimer Financial Services Guide | Information on our services - NABIt wasn’t a unanimous decision by the Bank of England overnight. Some of the board wanted to lift rates, the majority wanted to hold, but there was one who still wanted to push them higher. All in all a March cut is now extremely unlikely according to NAB’s Gavin Friend, who says those pricing in 100bp of cuts this year have probably got it wrong. We also look at the fed’s decision, one day on. Shares are higher and bond yields lower, so it seems the prospect of delays in cuts hasn’t phased the markets too much. The latest ISM report painted a slightly more optimistic picture for US manufacturing, but prices remain a concern. Wages will be watched keenly, of course, in the non-farm payrolls out on Friday in the US. Jerome Powell said this week he was looking for more “good data” – maybe this will be one of those reports. Hosted on Acast. See acast.com/privacy for more information.

Thursday 1st February 2023NAB Markets Research Disclaimer Financial Services Guide | Information on our services - NABAt the FOMC today a unanimous decision was made to keep rates on hold, but there was suggestion that they’d be cutting rates anytime soon. JBWere’s Sally Auld says this will dent the optimism of those hoping for a lower rate in March. Australia’s inflation numbers yesterday are also unlikely to change the stance of the RBA next month. The Bank of England meets later today – three of the nine board members voted for a hike last time.  Hosted on Acast. See acast.com/privacy for more information.

Wednesday 31st January 2024NAB Markets Research Disclaimer Financial Services Guide | Information on our services - NABWe are less than 24 hours away from the next FOMC meeting. NAB’s Tapas Strickland says an indication that the Fed was dropping its tightening bias would help validate the higher expectations for cuts in market pricing. But will it happen? Even though inflation is falling, consumer confidence is also on the rise and there are more than 9 million jobs looking for employees. Also today we discuss Australia’s retail numbers yesterday, what we can expect in today’s CPI and the latest forecasts from the IMF, which paints a slightly rosier picture in their latest World Economic Outlook.  Hosted on Acast. See acast.com/privacy for more information.

Tuesday 30th January 2024NAB Markets Research Disclaimer Financial Services Guide | Information on our services - NABFor all the delaying tactics of central bank speakers, markets are still pricing cuts earlier for the fed and the ECB. So who goes first? NAB’s Ray Attrill says it’s a two-horse race, although markets are pricing in early cuts in Europe. That could all change, of course, depending on what’s said by the FOMC tomorrow. Europe’s destiny will be somewhat shaped by it’s GDP numbers today, which are expected top show that the Euro area is in recession. There’s also discussion about Australia’s retail numbers out today, which are expected to show a fall in December in response to the bounce in sales (because of sales) in November. Hosted on Acast. See acast.com/privacy for more information.

Monday 29th January 2024NAB Markets Research Disclaimer Financial Services Guide | Information on our services - NABYou want busy, we’ll give you busy.The FOMC and the Bank of England meet this week and five of the magnificent 7 report earnings. We’ll also see the latest Australian CPI read and payrolls data from the US. NAB’s Rodrigo Catril joins Phil to catch up on data from the tail end of last week, which saw US core-PCE dip below 3%, whilst European data continues to show more of a downturn, with signs that the ECB may be changing its tune on waiting till June to cut rates. Hosted on Acast. See acast.com/privacy for more information.

Thursday 25th January 2024Please note this communication is not a research report and has not been prepared by NAB Research analysts. Read the full disclaimer here.By and large investors will have seen slim returns from Australian equities in 2023, but they would have made far more from US shares and, in particular, the magnificent seven. So, does the same apply for this year? Phil asks Gemma Dale, Director of SMSF and Investor Behaviour at nabtrade, who says 2023 wasn’t too bad when you factor in dividends. But 2024 could be better. Rates are coming down at some point, bond yields are falling and, you’d hope, the consumer will have more cash to spend. All of that, you’d assume, points to a rosier picture for equity investors, but which sectors will do the best? Hosted on Acast. See acast.com/privacy for more information.

Thursday 25th January 2024NAB Markets Research Disclaimer Financial Services Guide | Information on our services - NABTheres a more risk positive mood this morning NAB’s Rodrigo Catril says its being driven by moves in China to drive an economic recovery, including a half percent cut in the reserve requirement ratio for lenders. There’s been more attention ,though, to talk of a (long awaited) fiscal stimulus. Japan’s currency moved higher as investors mulled over the commentary form the bank of Japan, suggested a move into positive rates was looking more likely. Whilst the Bank of Canada highlighted that the days of rate rises are over for now, without giving any timeline for cuts. In PMIs Europe showed further weakness against US strength. Another reason for the ECB to cut rates sooner rather than later, but few expect that to happen at tomorrow’s meeting. Hosted on Acast. See acast.com/privacy for more information.

Wednesday 24th January 2024NAB Markets Research Disclaimer Financial Services Guide | Information on our services - NABThe Aussie dollar gained a bit of ground briefly yesterday on reports of China launching a rescue package to placate their retail investors, with shares now the furthest they’ve ever been behind the US. NAB’s Ray Attrill says there’s a question mark as to whether they are addressing the symptoms rather than the root cause. The European economy has had more bad news, with loan data showing companies still are not borrowing, whilst consumer confidence is falling. Is the ECB wrong to consider delaying cuts till June? Today’s PMIs will shed some light on what has been a widening chasm between US and European economic health. Hosted on Acast. See acast.com/privacy for more information.

Tuesday 23rd Janaury 2024NAB Markets Research Disclaimer Financial Services Guide | Information on our services - NABUS equities hit new highs again overnight, reflecting the optimism for an economy that’ s beating inflation and escaping recession. Even the continuance of weak data and pessimism for the Chinese economy is failing t impact US ebullience. NAB Skye Masters says bond markets were more contained, reflecting a day light on news or data prints. There’s not expected to be a policy change fr the Bank of Japan today, but there is a press conference and we get to see revised quarterly forecasts which could help determine when or if there will be future policy changes. Locally, the NAB Business Survey is out today. Hosted on Acast. See acast.com/privacy for more information.

Mondaay 22nd January 2024NAB Markets Research Disclaimer Financial Services Guide | Information on our services - NABThe S&P hit its first high since January 2022 on Friday, driven largely by the major tech stocks. Phil asks whether there’s just too much exuberance? NAB’s Tapas Strickland says it’s an important week for tech earnings this week, including Netflix, Tesla and IBM. US positivity was also reflected in the Michigan consumer sentiment survey, which came in much higher than expectations. The UK and Europe are on a very different trajectory, with a significant fall in retail sales in December possibly leading the economy into a recession. This week Athony Albanese is expected to announce further stimulus measures to ease the cost-of-living crisis which could delay the speed of rate cuts by the RBA. The detail is expected to be ironed out before his National Press Club address on Thursday. Hosted on Acast. See acast.com/privacy for more information.

Friday 19th January 2024Please note this communication is not a research report and has not been prepared by NAB Research analysts. Read the full disclaimer here.Our guest on the Weekend Edition this week says Bitcoin started as an anarchic response to the rapidly rising quantity of Fiat currencies. UK economist and writer Frances Coppola still believes the value of Bitcoin is tied to the policies of central banks, particularly when it comes to cycles of QE and QT. But does it really? Many argued it was a hedge against inflation, but that never came to pass. So what changes with Bitcoin now the USD regulator has cleared the way for ETF’s to offer the chance for regular investors to easily buy or sell out of Bitcoin linked securities? Is it now a more respectable investment choice? Will it lose its volatility? And, if it does, what’s the point of it? Hosted on Acast. See acast.com/privacy for more information.

Friday 19th January 2024NAB Markets Research Disclaimer Financial Services Guide | Information on our services - NABUS bond yields continue to push higher as the expectation for delayed cuts mounts. The weekly jobless claims will help the Fed’s case here, with a surprise fall showing how tight the labour market still is. But these are volatile numbers, says NAB’s Gavin Friend, particularly over the holiday period. The same applies to the surprise drop in Australian employment numbers yesterday, although the trend is still showing a rise and there’s nothing to change the RBA’s path for now. Plus, peace hopes for the Middle east and a preview of our first Weekend edition of 2024. Hosted on Acast. See acast.com/privacy for more information.

Thursday 18th January 2024NAB Markets Research Disclaimer Financial Services Guide | Information on our services - NABMarkets are pricing more and more for delays in rate cuts. NAB’S Ken Crompton says even with pricing for cuts of 13bp in February that still shows some “irrational exuberance”. The expectations for delays in rate cuts follow Christopher Wallers comments earlier in the week that, with the economy seemingly in good health, why the rush? That view was supported by a range of positive data releases, including retail sales growth continuing into December. In the uK markets were a little surprised by a rebound in UK inflation, delaying chances of cuts by the BoE. In Australia NAB has revised its expectation for a rate rise by the RBA, but there’s a chance that it will stick with its current rate to the tail end of the year. Hosted on Acast. See acast.com/privacy for more information.

Wednesday 17th January 2024NAB Markets Research Disclaimer Financial Services Guide | Information on our services - NABBond yields have ushed higher in the US after the Fed’s Christopher Waller made a speech on the economic outlook at The Brookings Institute, called ‘Almost as Good as it Gets, but will it last?’. NAB’s Rodrigo Catril says he appeared less dovish than anticipated, hence expectations for rate cuts have been pushed back. Now the question is, will any central banks be cutting in the first half of this year? Today we look at the latest European data, the UK’s muddy employment numbers, as well as looking ahead to a busy 24 hours, with a swathe of China data, UK inflation and US retail number. Hosted on Acast. See acast.com/privacy for more information.

Tuesday 16th January 2024NAB Markets Research Disclaimer Financial Services Guide | Information on our services - NABGerman GDP fell 0.3% last year, even if they did manage to narrowly avoid a technical recession. Europe’s industrial production also fell in the latest data. Yet ECB members continue to talk down expectations for rate cuts at least until the middle of the year. Phil asks JBWere's Sally Auld about the wisdom of keeping rates higher in an economy that is slowing, and does that explain why markets are out of kilter with the central banks rhetoric?. In the US there will be a air bit of focus on what the Feed’s Christopher Waller has to say on rate cuts. There’s also discussion about why the PBoC didn’t cut their medium-term lending facility. Data wise we see Australia’ s consumer confidence today, along with UK wage data, Canada’s CPI and NZ’s quarterly survey of business opinion. Plus the results of the Iowa Caucus. Hosted on Acast. See acast.com/privacy for more information.

Monday 15th January 2024NAB Markets Research Disclaimer Financial Services Guide | Information on our services - NABThere were big falls in 2 year Treasury yields on Friday. NAB’s Ray Attrill says this can be attributed to softer than expected producer prices in the US, which feeds through to the PCE deflator number that the Fed uses as its inflation measure. So what has this done to rate cut expectations? Ray says we’re still not back to where we were in the lead up to Christmas. Inflation is coming down much more slowly in Europe. Will it be delayed further by the crisis in the Red Sea? China published weaker loans data at the end of the week, and the PBoC is expected to lower the medium-term loan rate today. We’ll also see whether there’s any response from China to the Taiwan election result whilst the US holds the first Republican Caucus, in Iowa, where Trump is well ahead in the polls. Hosted on Acast. See acast.com/privacy for more information.

Friday 12th January 2024NAB Markets Research Disclaimer Financial Services Guide | Information on our services - NABUS inflation was a little bit of a surprise. Whilst the headline rate was expected to rise a little, it came in higher than forecast, whilst the core rate didn’t fall as much as had been hoped for. NAB’s Ken Crompton says the Fed’s super core measure is the part of the inflation picture that refuses to come down, all of which could impact the speed at which the Fed will bring rates down. Meanwhile NAB has revised the forecast for Q4 CPI for Australia on the back of this week’s November data. It provides a CPI rate lower than the RBA’s forecast, so does that mean we can expect rates in Australia come down faster?  Hosted on Acast. See acast.com/privacy for more information.

Thursday 11th January 2024 NAB Markets Research Disclaimer Financial Services Guide | Information on our services -NABAustralian inflation fell faster than expected in November. Phil asks NAB’s Taylor Nugent what this means for the rate path from the RBA. He says the monthly data is a relatively new indicator and is still volatile, so we should be cautious in interpreting the numbers and certainly there wasn’t anything to make the RBA too comfortable. We can expect a more definitive market response to US CPI later on. If the number falls below consensus and highlights potential for a faster cutting cycle from the Fed expect that to drive the US dollar lower. Hosted on Acast. See acast.com/privacy for more information.

Wednesday 10th January 2024NAB Markets Research Disclaimer Financial Services Guide | Information on our services - NABMarkets have started the year rather cautiously. Bond yields have held up and equity markets are clearly nervous, suggesting many investors are questioning the speed of the path to rate cuts, particularly in the US. Could Friday’s strong non-farm payrolls read last Friday add to the case for delays by the Fed? NAB’s Ray Attrill suggests the markets might be too cautious. We also look at yesterday’s retail numbers for Australia and expectations for the November inflation read out this morning. Hosted on Acast. See acast.com/privacy for more information.

Friday 22nd December 2023Please note this communication is not a research report and has not been prepared by NAB Research analysts. Read the full disclaimer here.In our final edition of The Morning Call for the year JBWeir’s Sally Auld joins Phil to look back about the surprises of 2023, and to give some of her predictions for 2024. Few expected interest rates to rise as high as they did, but even so, there was a lot of recession talk. Yet, somehow, we avoided it, with much greater expectations for a soft landing. So, is that the story for 2024? Perhaps, but Sally springs five potential wildcards on us that we should have in the back of our minds. 2024 is certainly not going to be a year low on risk.  This is our last Morning Call of the year. Thank you for joining us each weekday, and we hope you’ve enjoyed the addition of the Weekend Edition. We’ll be back on Wednesday 10th January ready to interpret whatever the new year throws at us.  Hosted on Acast. See acast.com/privacy for more information.

Friday 22nd December 2023NAB Markets Research Disclaimer Financial Services Guide | Information on our services - NABWell, you could argue that if the US wants to get inflation down to 2% that its already there. Why? NAB’s Ray Attrill points out that the latest quarterly PCE read – the Fed’s preferred inflation measure – has been revised down to an annual figure that falls within their target range. The monthly number for November, out tonight, could well reinforce this argument and add more weight for rate cuts early in 2024. In other news, Joe Biden has been discussing increased tariffs on the import of EVs from China. Australia could feel the repercussions of that and could be one factor stopping the Aussie dollar reaching 70 US cents anytime soon. Today, Japan’s CPI and the latest revision to UK GDP. Just like the US numbers, could they also be a downward surprise and reopen recession speculation?This is our last daily edition until January 10th, but this afternoon JBWeir’s Sally Auld gives her thoughts on where we’ve been this year and the prospects for 2024. To be listened to at your leisure over the Christmas break. Hosted on Acast. See acast.com/privacy for more information.

Thursday 21st December 2023NAB Markets Research Disclaimer Financial Services Guide | Information on our services - NABUK inflation fell much faster than expected and more than the Bank of England predicted. NAB’s Gavin Friend in London says its clear that there will be no more rate hikes in the UK, reflected in markets today with a sharp rise in equities and a significant drop in bond yields. There was another Christmas gift in the US Conference Board’s consumer confidence read which showed heightened optimism for the new year. The only negative sign was, perhaps, a rise in the jobs plentiful index which could arguably delay the fall in wage growth. Meanwhile, the EU is clearly ready to move on from worrying about inflation to focusing on government debt, with finance ministers today agreeing that all member states should return to a debt to GDP ratio of 60%. Good luck with that! Hosted on Acast. See acast.com/privacy for more information.

Wednesday 20th December 2023NAB Markets Research Disclaimer Financial Services Guide | Information on our services - NABThe RBA minutes yesterday were more hawkish than expected. NAB’s Rodrigo Catril talks about how the central bank is aiming for the mid-point of their 2 – 3 percent target range, rather than the top, raising the prospect of rates staying higher, or a more concerted effort to bring inflation down faster. This adds to the speculation that interest rates will be lifted in February, although a lot will depend, of course, on Q4 CPI, out late in January. Elsewhere, the Bank of Japan did and said little and Canada’s core inflation bounced back up a little. A reminder to all that it isn’t beaten yet.   Hosted on Acast. See acast.com/privacy for more information.

Tuesday 19th December 2023NAB Markets Research Disclaimer Financial Services Guide | Information on our services - NABUS bond yield rose higher overnight, along with equities, as the prospect of a slower path of rates cuts by the Fed sinks in. NAB’s Skye Masters says it’s a settling down after the rally in bonds we’ve seen in the last month or so, helped by more Fed speakers overnight talking down the prospect of early rate cuts next year. In other news, the German IFO reader can be added to the list of releases showing a European slowdown. The focus today will be on the RBA minutes. Skye isn’t sure there will be much to gain beyond the statement earlier in the month, but never say never. The same applies to the Bank of Japan meeting today – they are not expected to lift rates, or give an indication of when they will, but they have provided a pre-Christmas surprise before.  Hosted on Acast. See acast.com/privacy for more information.

Monday 18th December 2023NAB Markets Research Disclaimer Financial Services Guide | Information on our services - NABThe US Fed’s John Williams said on Friday that it was too soon to be looking at rate cuts, despite the FOMC dots plot showing members expecting several cuts next year. Phil Dobbie asks NAB’s Tapas Strickland about Williams’ motivation and the market response. Meanwhile, as data from China remains soft the PBoC is pumping 800 billion Yuan into the economy. Tapas explains the approach and whether it will work. European PMI data came in softer than expected, whilst the UK seems a little more resilient in the services sector. But with a central bank governor reluctant to move too quickly, is stronger data good or bad for Britain? Hosted on Acast. See acast.com/privacy for more information.

Friday 15th December 2023Please note this communication is not a research report and has not been prepared by NAB Research analysts. Read the full disclaimer here.When it comes to the use and deployment of AI a Deloitte report reckons many Australian businesses are slow to catch on to the risks and opportunities it presents. This week Phil Dobbie talks to Rhiannon Yetsenga, a manager in the Economic Analysis and Policy team at Deloitte Access Economics, about a recent survey of 2,500 Australian employees and students, which highlights how Generative AI in particular is transforming the workplace. Rhiannon says, unlike many business transformations, this one is being employee led. Companies need to be aware that it is happening, learn how to manage risk and take advantage of the opportunities it presents, as a first-step to more complex AI projects. Hosted on Acast. See acast.com/privacy for more information.

Friday 15th December 2023NAB Markets Research Disclaimer Financial Services Guide | Information on our services - NABWhilst the FOMC signalled the likelihood of several rate cuts next year, NAB’s Gavin Friend says the Bank of England and ECB are giving nothing away, with both saying there is more to e done to bring inflation under control. One European bank even managed to slip in a rate rise ahead of Christmas – the Norges Bank pushed rates up to 4.5%, concerned about a rebound in inflation. Markets continue to respond to the dovish FOMC meeting yesterday, even with jobless claims and retail numbers both showing surprising resilience in the US economy. There’s lots more economic data today, including the December flash PMIs for Europe, the UK and US. Hosted on Acast. See acast.com/privacy for more information.

Thursday 14th Decenber 2023NAB Markets Research Disclaimer Financial Services Guide | Information on our services - NABA Fed that is happy to hold, and is expecting to cut three times next year. That’s the takeout from the FOMC meeting this morning. Markets have responded swiftly, with sharp moves down in the US dollar and bond yields, with the Aussie dollar making the biggest gains this morning. NAB’s Taylor Nugent says yields were already falling on the back of slower rises in producer prices, adding to the evidence that inflation is easing in the US. The Bank of England meets later today, along with the ECB. Both are expected to stay put, with the UK having much lower than expected GDP growth in October. Australia’s employment numbers are released today, after yesterday’s Seek job ads show more labour market easing. Hosted on Acast. See acast.com/privacy for more information.

Wednesday 13th December 2023NAB Markets Research Disclaimer Financial Services Guide | Information on our services - NABIn numbers out overnight the headline US CPI rate fell a little, but no more than expected, whilst core inflation remained stuck at 4%. JBWere’s Sally Auld says it again showed the dichotomy between core goods, which fell 0.3% in the month, and services which rose 0.5% in the month. It’s not expected to change the Fed’s decision tomorrow, or the outlook for cuts in the first half of 2024, but that could change with the dots plot from the FOMC. Elsewhere, the latest ZEW survey from Europe showed a surprise lift, whilst oil continues to slide lower. In short, not a huge reaction to an unsurprising CPI, and all now rests on what’s said and forecast tomorrow. Hosted on Acast. See acast.com/privacy for more information.

Tuesday 12th December 2023NAB Markets Research Disclaimer Financial Services Guide | Information on our services - NABThe Yen is the biggest currency move overnight, losing some of the recent gains. NAB’s Ray Attril says it comes from a Bloomberg story overnight which doused expectations that there will be a ‘surprise’ policy change next week. Otherwise, markets are largely treading water ahead of the US CPI number later today, followed quickly by the Fed later in the week, along with four other central banks.Also on today’s podcast we look at four decades of a free floating Aussie dollar. It’s 40 years ago today that the AUD floated freely for the first time. Ray takes us through some of the highs and lows. Hosted on Acast. See acast.com/privacy for more information.

Monday 11th December 2023NAB Markets Research Disclaimer Financial Services Guide | Information on our services - NABThe US non-farm payrolls data came in a lot higher than expected on Friday, with 200k extra jobs added last month. Wages grew a little more than expected. Not what you’d expect for an economy that is supposedly cooling. So, were the numbers too hot? Phil asks NAB’s Rodrigo Catril whether this changes assumptions around the timing of rate cuts by the Fed. He says some of the new jobs were one-offs, and the trend is still downwards, but markets have repriced their expectation for cuts in the early part of next year. There’s also discussion on Europe’s new AI laws and China’s worse than anticipation deflation. Hosted on Acast. See acast.com/privacy for more information.

Friday 8th December 2023Please note this communication is not a research report and has not been prepared by NAB Research analysts. Read the full disclaimer here.It’s been fifty years since the UK signed an agreement with the European Economic Community. That had a profound impact on Australian exports. We’ve built a far more diverse export base since then, of course, but now, since Brexit, with a new free trade agreement (FTA) in place, there’s a chance to redevelop our trading relationship with the UK. Elisabeth Bowes, Australia’s Deputy High Commissioner to the UK, was deeply involved in negotiating the UK Australia FTA. She said, it made her proud as a Queenslander to see, back in September, the first tariff free shipment of sugar in fifty years to arrive in the UK. On this edition of The Weekend Edition Elisabeth outlines how Australian businesses can benefit from the agreement, whether its exporting goods, procuring UK government business, establishing a foothold within Europe, or recruiting expertise from Britain. Hosted on Acast. See acast.com/privacy for more information.

Friday 8th December 2023NAB Markets Research Disclaimer Financial Services Guide | Information on our services - NABProbably not, is the answer to our headline, but NAB’s Ken Crompton says markets are pricing in a heightened expectation of the BoJ moving from negative rates sometime soon. The sharp rise in Japanese government bond yields yesterday and overnight almost wiped out the falls over the last month, but yields remain well below early November, when they almost touched 1%. Elsewhere, Australia’s trade surplus increased but it was largely due to a fall in capital goods imports, reversing the recent rise. Europe showed more signs of a slowdown, with German industrial production down and Q3 GDP revised lower. The focus now is now on non-farm payrolls. Ken says there’s more upside potential for bond yields if we assume markets have been too optimistic in their pricing of rate cuts next year. Hosted on Acast. See acast.com/privacy for more information.

Thursday 7th December 2023NAB Markets Research Disclaimer Financial Services Guide | Information on our services - NABFalling inflation and lowering interest rates is definitely the consensus view now. It comes at the cost of weaker demand, evidenced by the continued drop in oil prices. NAB’s Ray Attrill says falling fuel costs are no doubt helping European equities, which finished higher today whilst US share indices struggled to get traction. Markets are now pricing in 150bp in cuts from the ECB next year, although Ray suggests that’s overly optimistic. Australia’s GDP growth was much slower than expected last quarter, but there’s not been a strong response to it on currency and bond markets. The consumer is still finding money to keep spending and productivity isn’t making the gains the RBA would like to see. Now the focus is on jobs, with the weekly US jobless claims tonight ahead of the monthly non-farm payrolls tomorrow. Hosted on Acast. See acast.com/privacy for more information.

Wednesday 6th December 2023NAB Markets Research Disclaimer Financial Services Guide | Information on our services - NABThe RBA kept rates on hold, didn’t change too much in their statement, but Australian bonds still rallied. JBWere’s Sally Auld says it was a curious reaction, but just about every market wants to avoid contemplating that rates could go higher even if that might still be the case here. Globally the mood is being driven by weaker CPI data. The OECD revealed that it has fallen to the slowest pace since October 2021 in its member countries. And ECB hawk Isabel Schnabel has completely changed direction, suggesting rates there will fall next year. In the US the Services ISM rose a little and the jobs market eased a bit, helping contain wage price concerns. In short, it was generally a good news day. Although equities are still mixed and oil continues to head south. Hosted on Acast. See acast.com/privacy for more information.

Tuesday 5th December 2023NAB Markets Research Disclaimer Financial Services Guide | Information on our services - NABWith shares falling and bond yields rising, markets might have taken a step too far when it comes to anticipating the timing of rate cuts next year, but NAB’s Tapas Strickland says cuts are still expected. They have just priced in a little more risk ahead of a series of key data releases this week, including payrolls (Friday) and services ISM (today). The RBA meets today and the accompanying statement could be a little dovish, given weaker inflation data, but there’s resilience in consumer and housing data that makes NAB believe a February hike is still likely. As well as the US Services ISM tonight, there’s also the JOLTs numbers (job openings and quits) which has had the power to move markets recently. Hosted on Acast. See acast.com/privacy for more information.

Monday 4th December 2023NAB Markets Research Disclaimer Financial Services Guide | Information on our services - NABWhen it comes to predicting rate cuts by the Fed, will the chair Jerome Powell be the last one to shift his position? During his ‘fireside chat’ on Friday he said it would be premature to assume they have achieved a sufficiently restrictive stance. As NAB’s Taylor Nugent points out, markets clearly aren’t paying too much attention, with yields falling sharply lower at the end of the week. Although there were two words in Powell’s talk that could support the idea of cuts sooner rather than later. Meanwhile two central banks are expected to keep rates on hold – the RBA tomorrow and the Bank of Canada later in the week. And focus now switches to employment numbers, with US non-farm payrolls data out on Friday. Hosted on Acast. See acast.com/privacy for more information.

Friday 1st December 2023Please note this communication is not a research report and has not been prepared by NAB Research analysts. Read the full disclaimer here.On The Weekend Edition NAB CEO Ross McEwan says his focus next year is on keeping customers safe from cybercrime, fraud and scams. Phil Dobbie also asks him about the role of AI to help counter cybercrime as well as help in the day-to-day operation of the bank. In a wide-ranging discussion, they also look at the economic outlook for 2024, fixing Australia’s housing affordability and getting people back into the workplace. Hosted on Acast. See acast.com/privacy for more information.

Friday 1st December 2023NAB Markets Research Disclaimer Financial Services Guide | Information on our services - NABEuropean inflation fells a little faster than expected. It’s knocked the Euro a little today, but JBWere’s Sally Auld says for the Euro to really see some gains it’ll take a combination of US rate cuts alongside strong growth outside the US, to help drive down the dollar. Meanwhile, the dollar ticked up a little today, with no surprises in the Core PCE numbers, and some unsurprising high-for-longer sentiment from Fed speakers. Jerome Powell will no doubt follow the same script in his fireside-chat later today. Aussie yields rose quite a bit higher overnight, perhaps because data is showing some resilience, particularly in housing. China’s PMI’s yesterday though, showed just how fragile their recovery is. Hosted on Acast. See acast.com/privacy for more information.

Thursday 30th November 2023NAB Markets Research Disclaimer Financial Services Guide | Information on our services - NABAustralian inflation was lower than expected yesterday. It was the same in Germany. And US quarterly PCE prices were revised lower. All signs that seem to be indicating price growth is slowing and central banks will be pushing rates lower. But there are some caveats to all that. NAB’s Gavin Friend reminds us that the monthly CPI numbers in Australia are heavily influenced by the sample rotation, which will have underplayed services inflation, so it’s too early to take NAB’s prediction of another hike off the table. In New Zealand, even though the RBNZ kept rates on hold yesterday, higher demand from immigration could force another move higher. Today’s US monthly core PCE deflator and the inflation numbers for the whole of the Eurozone will give a clearer picture. For now though, bond markets are enjoying the ride. Hosted on Acast. See acast.com/privacy for more information.

Wednesday 29th November 2023NAB Markets Research Disclaimer Financial Services Guide | Information on our services - NABBond yields pushed lower as markets continue to expect rate cuts by the Fed next year. Tapas Strickland says NAB’s own modelling based on recent data supports significant cuts next year. The Fed’s Chris Waller, who had previously flagged concern about the pace of growth saying “something’s gotta give”. Now he’s saying it’s the pace of the economy that is giving and the Fed is in a good place to return inflation to 2%, eventually. Comments like that have helped push bond yields lower. Today the focus is on the first bits of CPI data from Europe, and Australia’s monthly CPI read. Hosted on Acast. See acast.com/privacy for more information.

Tuesday 28th November 2023NAB Markets Research Disclaimer Financial Services Guide | Information on our services - NABIt’s an in-between day, with little ion the way of economic news, but inflation data just round the corner, in the form of Australian CPI and US PCE. There were sizeable auctions of 2 and 5 year Treasuries this morning, with softer demand, but that hasn’t driven the direction of bond markets says NAB’s Skye Masters, because yields are down. Instead it adds to the mood that the Fed will cut rates, perhaps early next year. Softer US data, such as weaker new home sales and drops in employment in the Dallas Fed manufacturing index, add to the supporting evidence. Today Australian retail sales are released, and we talk through some of the findings in the latest NAB Online Sales Index. Hosted on Acast. See acast.com/privacy for more information.

Monday 27th November 2023 NAB Markets Research Disclaimer Financial Services Guide | Information on our services - NABAt the end of a quiet week we saw the US dollar fall a little further on Friday. NAB’s Ray Attrill says this reflects the expectation that there will be no further hikes from the Fed. The Aussie dollar hasn’t realised the full potential, largely because of question marks over the speed of the Chinese recovery. There was mixed economic news at the end of the week; US PMIs were a little softer than expected, particularly for manufacturing. It seems Black Friday online sales were strong, and retail sales in New Zealand and Canada were better than expected. So, will too much resilience add to inflation woes. The BoE’s Huw Pill says supply constraints continue to be the issue so they need to hammer demand down to meet it. The key number this week will be the PCE inflation data out of the US. Nobody wants to see that tick up again. Hosted on Acast. See acast.com/privacy for more information.

Friday 24th November 2023Please note this communication is not a research report and has not been prepared by NAB Research analysts. Read the full disclaimer here.Consolidation will continue in the superannuation industry as a way of provided better returns for members. That’s the prediction from Mercer’s Chief Investment Officer Kylie Willment, talking to Phil on the Weekend Edition. Mercer recently merged with BP Super, of course, and Kylie says they are always on the look out for other opportunities. They are also focusing more on unlisted assets, that can provide value with more predictable returns. She talks through their key areas of focus. Finally, the Achilles Heal of Australian super is how funds manage the post-retirement relationship with members. Kylie says it’s what stopped Australia getting an A+ grade in the latest Mercer CFA Institute Global Pension Index. Hosted on Acast. See acast.com/privacy for more information.

Friday 24th November 2023NAB Markets Research Disclaimer Financial Services Guide | Information on our services - NABMarkets were relatively quiet overnight with the US off for Thanksgiving, but stronger PMI data from Europe created some interest, pushing the Euro higher, but NAB’s Ray Attrill still says German can expect to enter a shallow recession. The pound performed slightly better because it provided the only PMI number that actually indicated growth. The Riksbank surprised by keeping rates on hold and right-wing anti-EU candidate Geert Wilders won the most votes in the Dutch general election. Today US PMIs will provide a useful comparison to the European numbers, and one month out from the next BoJ meeting we’ll get to see Japan’s CPI numbers today. Hosted on Acast. See acast.com/privacy for more information.

Thursday 23rd November 2023NAB Markets Research Disclaimer Financial Services Guide | Information on our services - NABAustralian inflation is now driven by local factors. That’s what the RBA’s Michelle Bullock said at the Australian Business Economists dinner last night. JBWere’s Sally Auld says it doesn’t sound like a central bank that’s done with interest rate hikes, and points to how we are sitting 100 basis points below our economic peers. So can we really expect to get away with just one more rate hike? Meanwhile softer data from the US, mixed, curiously, with rising inflation expectations. Oil is choppy ahead of the delayed OPEC+ meeting – Sally explains the significance of the delay. And the UK’s min-budget delivered little except a forecast for growth next year, light on business investment and heavily dependent on government consumption, whilst the Chancellor’s rhetoric promised the opposite. European PMIs are the big numbers today but trade will be light tonight as the US starts Thanksgiving. Hosted on Acast. See acast.com/privacy for more information.