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Macro Morning

  By Chris Becker  The latest US CPI data and somber (i.e realistic) testimony from Dr Fauci about the coronavirus in the US put a big dampener on risk taking overnight with US stocks falling 2% across the board. The USD fell against the major currencies, while commodity currencies like Aussie and Loonie went the

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Credit Suisse: Economic disaster needs -5% interest rate

Via the excellent Damien Boey at Credit Suisse: Mixed April NAB business survey: The NAB survey for April revealed an even sharper decline in business conditions, with the component sum index falling to -34 from a downwardly revised -22. However, the more forward looking, “pure” confidence measure, improved to -46 from an upwardly revised -65, as companies adjusted to

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Melbourne property prices roll over

CoreLogic’s daily index has begun to roll over in Melbourne, falling 0.22% over the past 8 days: This is only the beginning, of course. Melbourne’s economy is arguably the most exposed to the COVID-19 economic meltdown given it will be the most impacted by the anticipated slump in immigration: Indeed, Melbourne’s economy is little more

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International student arrivals collapse

The Australian Bureau of Statistics (ABS) yesterday released international student arrivals data for March, which registered a sharp fall. As shown in the next chart, annual international student arrivals have fallen 9.7% (60,400) from January’s peak, from 621,500 to 561,100: This heavy fall in student arrivals has obviously been caused by COVID-19 travel bans, which

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Links 13 May 2020

Global Macro / Markets / Investing: “Research shows that college graduates who start their working lives during a recession earn less for at least 10 to 15 years than those who graduate during periods of prosperity.” – Stanford Coronavirus crisis could see wealth taxes implemented around the world, economist claims – CNBC Increase in unemployment

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Macro Afternoon

A mixed trading session throughout Asia with most stock markets slipping or putting in scratch sessions in response to the equally mixed and cautious run on Wall Street overnight. Gold is holding above the $1700USD per ounce level as the USD is reverting slightly going into the London open as oil prices start to pick

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Overseas arrivals collapsed in March

The Australian Bureau of Statistics (ABS) has released visitor arrivals and departures statistics for the month of March, which reveals a massive decline in visitor numbers on the back of COVID-19 travel bans. The number of arrivals collapsed by 60.3% in March versus the same month last year, whereas departures also collapsed by 64.9%: In

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Inflation expectations crater

Roy Morgan Research has released its inflations expectations survey, which have cratered to a near record low 3.6% over the next two years: Women expect price increases of 4.2% per year over the next two years while men expect prices to increase 3%. This gap is evident for all age groups and most pronounced for

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Competitors cherry-pick NBN’s most profitable networks

I have noted previously how Australia’s National Broadband Network (NBN) is facing multiple competitive threats. First, the roll-out of high speed 5G mobile services by Telstra and TPG / Vodaphone threatens to slice the NBN’s market share amongst casual users seeking fast speeds but low download limits. Indeed, Telstra chairman John Mullen recently flagged plans

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Developers smother lipstick on Aussie property pig

Several Aussie property developers have joined forces to sooth fears that Australia’s property market is facing a deep correction: Colliers Brisbane director Andrew Scriven: “I like to remind everyone that it is a health crisis that is turning into an economic crisis, but aside from that the fundamentals of property are still solid”… “The GFC

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Crikey: Temporary visa tsunami smashes Aussie wages

Crikey’s Bernard Keane is one of the few members of the Left to acknowledge that the flood of temporary migrants into Australia has undercut workers and contributed to weak wage growth: Restrictions on immigration are, in the view of neoliberals, particularly damaging. Everyone suffers: the poor individual from a developing country prevented from moving to

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Medicine shortage crushes Aussie ICU capacity

Well oh dear, at Domain: Hospitals are struggling to source drugs including propofol and cisatracurium, used to sedate patients before they are intubated, which are needed to take ICUs to full capacity if there is a second wave of coronavirus infections after restrictions are lifted. “As part of Australia’s COVID-19 response, hospitals are still on

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SQM: Australia’s rental market collapses

SQM Research has released its rental vacancy data for April, which recorded a massive increase in vacancies, driven by inner-city areas, alongside crashing rents. As shown in the next table, vacancy rates nationally surged by 0.6% over the month, driven by massive increases in Sydney (+1.0%), Melbourne (+0.9%) and Brisbane (+0.7%): The increase in vacancies

2

China exports deflation and lot’s of it!

Via China’s NBS: The year-on-year change in industrial producer prices Among the ex-factory prices of industrial producers, the prices of means of production fell by 4.5% year-on-year , an increase of 2.1 percentage points from the previous month , which affected the overall level of ex-factory prices of industrial producers by about 3.31 percentage points.

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Bitcoin: Sell the halvening

And then some apparently. Via FTAlphaville: Today’s the day that bitcoiners the world over have been waiting for. It’s the day – which only comes around every four years – that the supply of new bitcoins is cut in half. It’s the halvening! (OK yes, some bitcoiners just call it “the halving”, but we prefer

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KPMG tips U-shaped recovery for Aussie economy

KPMG has warned that the Australian economy will not recover its losses from the coronavirus pandemic until the September 2021 quarter. The firm’s research suggests that industries such as healthcare, public administration and civil engineering will have fully rebounded by the end of 2020, but the hospitality, accommodation, and retailing and sectors will not recover

2

Job ads bounce off the bottom

Callam Pickering, economist at global jobs site Indeed, has updated his job ad series, which suggests the Australian labour market is slowly climbing off the canvass. According to Pickering, new job ads – defined as those on Indeed 7-days or less – have actually climbed 73% from their low about three weeks ago; albeit they

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China bans Aussie meat exports

Breaking from The Australian: China has suspended meat imports from at least four Australian abattoirs overnight, as trade tensions between Australia and the communist nation rise. The Australian understands the Kilcoy plant, Beef City in Toowoomba, the Dinmore meatworks in Brisbane and the Northern Co-operative Meat Company at Casino in NSW have been suspended by

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China readying “flood stimulus”

Via Sinocism: The top items today’s newsletter look at: The economy, and signs from the PBoC that more stimulus is on the way as the focus expands from the “six stabilities” to include the “six ensures” and especially to ensure employment and avoid the potential social stability problems from mass unemployment; The claims that the

2

Inside the coal crash

From Westpac’s excellent Justin Smirk: Coal prices tumbled in April, iron ore was more stable while base metals firmed a little Coal prices have been falling rapidly with the latest spot Qld met coal prices down –39% in the last three months and Newcastle thermal down –21%. As a result we have lowered our near,

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Alan Jones retires

Big news for populists, at the ABC: Alan Jones has announced he will retire from radio at the end of this month. The long-time 2GB breakfast host has towered over Sydney’s media, and Australian politics for decades. During his broadcast this morning Jones told listeners: “We are living in the world of Coronavirus. The most

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Macro Morning

  By Chris Becker  Increased trade tensions between China and the US added caution to the mix in a flat session overnight on risk markets with most bourses making a hesitant start to the trading week. The USD reasserted itself against the majors while gold slipped back below $1700USD per ounce. Bitcoin continues to see