NAB Morning Call

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 information.

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.

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 acast.com/privacy for more information.

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.

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 for more information.

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 acast.com/privacy for more information.

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.

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.

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.

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.

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 acast.com/privacy for more information.

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.

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/privacy for more information.

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.

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.

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.

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.

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.

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.

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 information.

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/privacy for more information.

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 information.

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.

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 acast.com/privacy for more information.

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 acast.com/privacy for more information.

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.

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.

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 information.

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 acast.com/privacy for more information.

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.

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.

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.

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.

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 information.

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.

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.

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 acast.com/privacy for more information.

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.

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.

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.

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.

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.

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.

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.

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.

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.

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.

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.

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.

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 for more information.