Weekly Market WATCh
May 29, 2020
The Aussie Q1 construction work done report showed that the economy was on shaky ground even before the COVID-related lockdown, business capex plans for 2020-21 saw a sharp downgrade and credit growth slowed in April. In the US, the Fed’s summary of the US economy, the Beige Book, showed US businesses are pessimistic about the likely pace of the recovery, Q1 GDP growth saw a slight downgrade and durable goods fell heavily in April.PDF Download PDF
May 22, 2020
The RBA Board meeting minutes suggested that the central bank is content for the time being to keep policy unchanged, sit back, and see how things evolve. The weekly payrolls and wages report indicates that the Aussie labour market is stabilising. The CBA flash PMIs for May remained weak but suggest activity declined at a slower pace. Flash PMIs for Japan, Europe and the US indicated a slower pace of contraction in May, though conditions remain depressed.PDF Download PDF
May 15, 2020
In Australia, the NAB business survey showed that Australian business conditions remained poor in April, consumer sentiment picked up in May, while the wage price index indicated that wage inflation was weak even before COVID hit the economy. There were record job losses in April, even with the JobKeeper program in place.PDF Download PDF
Chinese activity data for April shows that the industrial sector is recovering, though retail spending remains weak.
US non-farm payrolls fell by 20.5 million in April, while the unemployment rate increased to 14.7% (released last Friday).
May 8, 2020
In Australia, the RBA Board kept the cash rate on hold. In March, dwelling approvals were better than expected, while retail sales posted a record monthly increase. Payrolls data showed big job losses from mid-March to mid-April. The Chinese Caixin PMIs pointed to ongoing contraction in both services and manufacturing in April, while the external trade report showed a surprising rise in exports. While imports fell more than expected iron imports were strong. In the US, the ISM non-manufacturing PMI fell for the first time since the global financial crisis in April and the ADP report printed a record slump in employment, which does not bode well for today’s non-farm payrolls.PDF Download PDF
May 1, 2020
Aussie underlying CPI inflation was higher than expected in Q1, international trade prices suggest there was a rebound in the terms of trade in the March quarter, the private sector credit report saw a big rise in business borrowing in March, house price growth slowed and manufacturing activity slumped in April.PDF Download PDF
The Chinese PMIs for April suggest that weak overseas demand is weighing on the Chinese recovery.
In the US, the advance Q1 GDP report saw the biggest quarterly drop in the US economy since Q4 2008, while weekly initial jobless claims data indicated that US job losses had risen to 30 million over the past six weeks.
April 24, 2020
RBA Governor Philip Lowe tells an audience that he expects the COVID-19 recession to be deep but short. Preliminary retail trade data reveal that sales posted a record increase in March on the back of COVID-related stocking up. Australian payrolls fell 6.0% in the two weeks to 4 April.PDF Download PDF
The flash PMIs for April in Australia, the US, Europe and Japan suggest that each of those countries has fallen into a deep recession.