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Technology stocks weighed on Wall St. overnight and saw the Nasdaq close -1.3%, the S&P 500 -.8%, while the Dow Jones fared better and closed +.5%.
US equities were down ahead of central bank meetings and rising tensions in the Middle East after an Israeli strike on Beirut. The USD made slight gains, while bond yields remained mostly stable. The yield on the US 10-year dropped by 3 bps to 4.14%.
Overnight, US Consumer Confidence increased by 2.5 points to 100.3. In the Eurozone, Q2 GDP grew by 0.3%, surpassing the expected 0.2% increase.
The US JOLTS data in June were 8.18 million job vacancies, which is a slight increase from the revised 8.23 million in May and exceeded expectations. The rates of hiring and quitting remained consistent at 3.4% and 2.1%, respectively. The ratio of job openings to unemployed individuals decreased to 1.2:1, aligning closely with the average seen before the pandemic.
A busy day ahead beginning in Australia where Q2 CPI will be a critical release ahead of the RBA Board meeting on August 6. Using the data available for April and May (representing around 72% of the weight of the Q2 print), markets estimate of trimmed mean CPI inflation for Q2 is +0.9% q/q (+3.6% q/q annualised). This would be an improvement from the +1.0% q/q reading in Q1, but above the RBA’s May forecast for ~0.8% q/q in Q2. If our expectation is realised, markets expect the RBA will leave rates unchanged at its next meeting. However, a trimmed mean reading of +1% q/q should see the RBA hike rates by 25bp to 4.60%.
Economic Data
• NZ – Jun. Building Permits m/m
• JP – Jun P. Industrial Production m/m and Jun. Retail Sales m/m
• JP – BOJ Target Rate (Lower & Upper Bound)
• AU – Q2. CPI q/q
• AU – Jun. Private Sector Credit m/m
• AU – Q2. Retail Sales Ex Inflation q/q
• CN – Jul. Manufacturing PMI and Jul. Non-Manufacturing PMI
• JP – Jun. Housing Starts y/y
• EU – Jul. CPI Estimate y/y
• US – Jul 26. MBA Mortgage Applications and Jul. ADP Employment Change
• CA – May. GBP m/m
• US – Q2. Employment Cost Index
• US – Jun. Pending Home Sales m/m
• AU – Jul. Core Logic House Px m/m
• US – FOMC Rate Decision (Lower & Upper Bound)
Mid market rates.
| Currency Pair | Mid-market rate |
| AUD/USD | 0.6540 |
| AUD/NZD | 1.1072 |
| AUD/JPY | 99.64 |
| AUD/CNY | 4.7356 |
| AUD/EUR | 0.6044 |
| AUD/GBP | 0.5092 |
AUD/USD 24 Hour
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