Weekly Market WATCh
November 20, 2020
Abroad, COVID-19 continues to rage across the Northern Hemisphere, with the number of cases accelerating strongly in the US forcing more states to re-introduce containment measures. US initial jobless claims rose last week, while US retail sales growth decelerated in October. Chinese economic data signalled ongoing recovery.PDF Download PDF
At home, the October labour force survey printed a surprising rebound in October, helped by Victoria re-opening and ongoing recovery elsewhere. Victoria re-opening also pushed October retail trade higher. Growth in the wage price index was the slowest on record in Q3.
November 13, 2020
Abroad, ‘stage 3’ test results point to a 90% efficacy of the Pfizer COVID-19 vaccine. Infections continue to surge across the Northern Hemisphere, with data releases pointing to the downward impact of the second wave of the pandemic on the European economy. The US labour market recovery continues, albeit at a slower pace.PDF Download PDF
At home, the NAB business conditions and confidence indices improved in October as Victoria started to re-open. Consumer sentiment continues to climb, with the Westpac gauge hitting the highest level since 2013.
November 6, 2020
Results point to a Joe Biden victory in the Presidential election, a Republican Senate and a Democratic House of Representatives. This diminishes chances for a large fiscal stimulus, particularly in the coming two months.PDF Download PDF
The public health crisis remains severe in the Northern Hemisphere. The UK government announced a new national lockdown last weekend and the Bank of England increased the size of its quantitative easing program on Thursday. At home, the RBA cut its interest rate targets to near zero and embarked on purchasing longer-term government bonds, including semis. Data released this week pointed to a stagnation in the labour market, a fall in consumer demand and an ongoing rebound in the housing market, helped by low interest rates and government incentives for construction.
October 30, 2020
In Australia, the CPI rebounded in Q3, helped by the end of free childcare and a rise in petrol prices. Export prices continued to fall in Q3, dragged down by the strong Australian dollar. Private sector credit growth remained weak in September. In the US, GDP rebounded strongly in Q3, core capital goods orders saw further strong growth in September and jobless claims continued to fall. The ECB signalled further easing is coming as COVID ravages Europe.PDF Download PDF
October 23, 2020
In Australia, the weekly payrolls suggested that the labour market recovery stalled in late September, while the preliminary retail sales report pointed to ongoing contraction across all states last month. The flash PMI report signalled an acceleration in output growth in October. The RBA Board minutes opened the door to a reduction of its interest rate targets to near zero and, possibly, the start of longer-term government bond purchases as early as next month. Abroad, Chinese economic activity data confirmed an ongoing recovery, with steel output at near record highs.PDF Download PDF
October 16, 2020
In Australia, the RBA Governor suggested further interest rate target cuts and, possibly, longer-term government bond purchases beyond the yield curve control policy. The September labour force report indicated that the recovery in Australian employment stalled in September amid the Victorian lockdown and a slowdown in job creation in some other states. Consumer confidence continued to improve. The labour market recovery has also slowed in the US, yet regional Fed surveys point to ongoing recovery. Chinese exports surged to all-time highs in September. The pandemic continues to accelerate across the advanced economies.PDF Download PDF