Friday night saw more DXY weakness: Driven largely by EUR strength: The Aussie pulled back against both: And EM forex: Gold took off, reaffirming more USD weakness: Brent was pounded: Base metals held up: Big miners didn’t: EM stocks sold: But high yield rallied: US bonds were bought: And European: Stocks eased in the US
Over the weekend, Paul Kelly nicely wrapped where our political parties have come to: The Prime Minister and the Opposition Leader operate in a new politics. It is the world of Donald Trump, social fragmentation, fake news and discredited elites. But they are opposites, with rival political and emotional views of the nation’s mood. Turnbull,
By Leith van Onselen Infrastructure Victoria CEO, Michel Masson, on Friday called on the state to take its time when deciding large infrastructure projects, while also arguing that it is often better to improve existing assets than to build expensive new ones. From The AFR: Australia should abandon its “childish” attitude of wanting new infrastructure
By Leith van Onselen The Australian’s Judith Sloan penned the following on Friday about the heated debate that she had with University of Melbourne demographer, Peter McDonald, with respect to Australia’s turbo-charged immigration intake [my emphasis]: I was engaged in a relatively heated but civil discussion of immigration with University of Melbourne demographer Peter McDonald
Anna Bligh is hard at work rebuilding trust in banking in South Australia: The Australian Bankers’ Association will campaign against the South Australian government-imposed bank tax until the state goes to the polls next March if it is not defeated in parliament, including daily advertising in local papers and stationing an action group in Adelaide. …ABA
CoreLogic released its auction report yesterday, which reported a continued firming in the national auction clearance rate to 74.8% from 72.4% last weekend, and was also above the 71.5% recorded in the same weekend last year: Auction volumes nationally were 1,712 – way above the 1,329 recorded in the same weekend last year. As shown above, Sydney’s
There are a few studies that show that the richer you are the better your investment returns – Thomas Piketty the French economist is probably the most well-known author in this space. A recent Vox article digs into these returns using detailed Swedish data and essentially finds the same thing. The top 5-10% of households
Good video here summarising the importance of this week’s OPEC meeting.
Iron ore price charts for July 21, 2017: Spot down. Paper down. I still expect the restock to persist a little while longer but we appear to be at the price peak.
Global Macro / Markets / Investing: Suddenly Becoming a Bond Manager in the Credit Crisis – Bloomberg Multi-party kleptocracies rather than illiberal democracies – Global Inequalities 10-Year Returns of U.S. Median Active and Passive Managers – PIMCO The heat goes on: Earth sets 9th straight monthly record – AP Venezuela’s Perfect Storm for Oil May
Global Macro / Markets / Investing: The New “Supply-Side Economics” Fueling Asset Bubbles – Macro Mom What the Decline of the Dollar Means – NY Times IMF Falls Short of Transparency Rules as Key Discussions Remain Secret – WSJ The power of populists – The Economist Americas: Trump’s Threat to Jail Clinton Also Targets Democracy’s
by Chris Becker The RBA’s inability to jawbone markets was the only big news in the Asian Friday session to finish the week as the USD remained relatively steady after selling off overnight on the expanded investigation into Trump’s collusion with Russia. Meanwhile the Aussie dollar and yields on Aussie bonds fell on the back
By Leith van Onselen Melbourne Institute of Applied Economic and Social Research deputy director, Roger Wilkins, has today labelled “patently false” the claim by Labor leader Bill Shorten that inequality in Australia is rising. From The AFR: Professor Wilkins told the Economic and Social Outlook Conference that the Australian Bureau of Statistics data on which
From Guy Debelle today: There are a large number of factors that the Reserve Bank Board takes into consideration in making its interest rate decision each month, both domestic and global. Today I would like to talk about some of the global influences on domestic monetary policy. As you are well aware, the Australian economy
By Leith van Onselen The AFR’s Laura Tingle is the latest to jump on the immigration debate, accusing politicians of burying the issue despite its massive impacts on the economy and society: One of the ways governments try to signal their changing priorities to voters is to change the names of ministerial portfolios and government
Dalian is soft during the day: Big Iron is copping it: Big Gas does not look well: Those descending triangles on the majors might break. Oil has rebounded but they haven’t… Big Gold still looks weak too: Big Bubble has lost it’s froth: And Big Liar is whatever: Avagoodweekend.
The front page of the Australian is highlighting that the Labor party is starting to make inequality an issue for the next election, and Leith ran a post yesterday about the Labor party and a possible inheritance tax for next year. I find the whole inheritance tax debate fascinating. In my experience Australian’s have 3
Via Citi: Balance sheet reductions and tapering Since 2008, central bank balance sheets across advanced economies (AEs) have expanded dramatically (e.g. Fed balance sheet went from 6% of GDP in 2007 to around 25% of GDP in 2015 and the ECB balance sheet went from 13% of GDP in 2007 to around 38% currently) and
By Leith van Onselen Back in March, New Zealand’s Productivity Commission (PC) has released a report entitled “Urban planning – moving beyond the wheel spin”, which basically concluded that Auckland’s housing system is under siege from the combination of rapid population growth butting heads with a dysfunctional planning system, which is unable to cope with
By Leith van Onselen At the same time as Labor is crowing about rising inequality, Prime Minister Malcolm Turnbull confirmed yesterday that the Coalition would push on with its pledge to cut the company tax rate to 25% for all companies. From The Australian: [The Prime Minister] turned attention to the government’s plan to cut
By Leith van Onselen Yesterday, senior public servant, David Gruen, unbelievably blamed the rise in male joblessness on video games. From The Australian: Video games are luring young men away from the workforce in large-enough numbers to show up in the labour force survey… Although the number of hours worked per person has declined since
You know my view but try Deutsche’s excellent Adam Boynton: A funding challenge? AUD/USD has recently broken out of the top of the range it has traded in for over a year. Despite that, and despite the recent RBA repricing in Australia, the 10-year spread to the US remains below the highs of ~55bp seen
Via UBS: Overall, employment remains very strong & clearly improved in recent months, with 2% y/y the best in over 2 years, ~consistent with positive lead indicators. Unemployment also fell in recent months to a cycle low of 5.6%. This supports the RBA’s ‘positive’ outlook in their minutes. But, the onus is on jobs and
DXY is sinking like a stone: The driver is EUR which has broken out big: AUD sold yesterday afternoon but is still afire: Gold was firm but is still weak relative to DXY weakness: Brent was soft: Base metals mixed: Big miners sank: EM stocks stalled: Lead by high yield: US bonds were bid: And
