Weekly Updates

The Aussie monthly CPI indicator pointed to a rise in inflation in August, while retail sales growth disappointed. Job vacancies saw a significant drop in the three months to August. WA report on state finances showed that the 2022-23 operating surplus was larger than first estimated, while total public sector net debt declined further. US durable goods orders rose in August.

The FOMC has left the fed funds rate target range unchanged, as expected, but revised its rate projection path upwards. In Australia, RBA minutes brought no major surprises. The Judo Bank composite PMI rose back into expansion in September.

Aussie employment rose much more than expected in August. The NAB business conditions and confidence indices both improved in August, but the Westpac consumer sentiment index deteriorated further in September. In the US, CPI inflation re-accelerated in August, while retail sales saw a solid increase propped up by higher fuel prices. Chinese retail sales and industrial output picked up in August.

The RBA left the cash rate unchanged on Tuesday. Aussie real GDP rose 0.4% in Q2, the same as in the previous quarter and in line with the market consensus. The US ISM services PMI pointed to a faster pace of expansion in US services activity in August. The Chinese Caixin services PMI suggested a further slowdown in August, but the annual pace of decline in exports and imports slowed.

The Australian monthly CPI indicator pointed to further disinflation in July, while retail sales rose more than expected. Home prices rose again in August. The annual rate of US PCE inflation rose slightly in July. The ADP report for August saw the smallest increase in US employment since March. The NBS PMIs pointed to a further slowdown in Chinese services and stagnation in manufacturing.

In Australia, Judo Bank flash PMIs pointed to further contraction in services and manufacturing activity in August. Abroad, flash PMIs confirmed slower expansion in the US, contraction in Europe and positive economic conditions in Japan. US durable goods orders fell in July. The People’s Bank of China took further, albeit disappointing steps to support the ailing economy.

The RBA minutes confirmed that a 25bps hike was discussed at the August meeting. Employment unexpectedly declined in July and the unemployment rate increased to 3.7%. Wages growth slowed in Q2. Abroad, FOMC minutes pointed to the possibility of further fed funds rate hikes. US retail sales and industrial output rose more than expected in July. Chinese economic data weakened further in July.

In Australia, NAB business conditions remained solid in July, but business confidence improved slightly. Westpac consumer confidence deteriorated further in August. Abroad, the annual rate of US CPI inflation rose slightly in headline terms, but core inflation ebbed further. Chinese external trade turnover continued its freefall in July, while deflation spread into consumer prices in annual terms.

The RBA kept the cash rate unchanged and signalled increased confidence that inflation is heading in the right direction. In Australia, retail sales volumes fell again in Q2. The trade surplus widened further in June amid a decline in imports. New home loans and dwelling approvals both fell in June, while the CoreLogic home value index saw another rise in July.

The Aussie CPI rose less than expected in Q2, with the annual rate of CPI inflation falling to 6.0%. Retail sales saw a surprisingly sharp drop in June. The FOMC increased interest rates by 25bps as expected. US GDP growth picked up a little in Q2. US durable goods orders surged in June. The flash PMIs pointed to further in US private sector business activity, but output price inflation picked up.

In Australia, employment saw another solid increase in June, while the unemployment rate remained low. The RBA Board minutes showed that the July decision to pause was a close call. Abroad, US retail sales rose less than expected in June, while industrial production saw a broad-based decline. Chinese GDP growth slowed in quarterly terms in Q2, while the June activity numbers were mixed.

The NAB business conditions index was stable but remained solid in June, while business confidence improved but remained soft. The Westpac consumer sentiment index improved in July, but consumers remain depressed. Payroll jobs rose again in the month to 10 June, while total wages climbed. US CPI inflation continued to decline in June. The fall in Chinese exports and imports accelerated in June.

The RBA Board left the cash rate unchanged at 4.10% at its meeting on Tuesday. Aussie home prices continued to climb in June, while there were also increases in dwelling approvals and new home loans in May. US ISM services rose further into expansion in May, while ADP employment rose most since late 2021. The Chinese PMIs pointed to expansion in services and stagnant activity in manufacturing.

In Australia, the monthly CPI indicator suggested that the annual rate of consumer price inflation declined to 5.6% in May, while retail sales rose more than expected. Abroad, US Q1 GDP growth was revised significantly upwards. US durable goods orders saw another solid increase in May, while the Conference Board consumer confidence index surged in June.

RBA minutes showed that the RBA Board discussed a pause at the June meeting, which led to a decline in cash rate expectations. Judo Bank flash PMIs pointed to a slower pace of expansion in the private sector in June. The Bank of England delivered a larger-than-expected rate hike. The People’s Bank of China continued to ease its monetary policy, though at a pace that was disappointing for some.

The FOMC has kept the fed funds rate unchanged but signalled that they will resume tightening later this year. The annual rate of US headline CPI inflation declined for the 11th consecutive month. Chinese economic activity data for May came out weaker than expected. Aussie employment saw another strong increase in May, while NAB business confidence and conditions deteriorated.

The RBA increased interest rates by 25bps, including the cash rate target to 4.10%. Aussie real GDP growth slowed in Q1, dragged down by sluggish consumption. Aussie payrolls jobs and wages rose strongly from a year ago. US ISM PMI report suggested that US services activity growth slowed in May. The Chinese Caixin services PMI rose further into expansion in May, while the trade surplus narrowed.

The monthly CPI indicator pointed to a rise in inflation in April. Home price growth accelerated in May, while new home loans and dwelling approvals declined in April. US ADP employment saw a solid increase in May, while the ISM manufacturing PMI fell further into contraction in May. The Chinese PMIs were mixed in May, but overall pointed to further modest expansion.