Monday: Attention on Aus jobs for RBA clues

Fed hike pricing retreats further after weak US retail sales; Australian housing lending drops as the RBA looks for signs of reduced activity. New Zealand’s patchy recovery continues.

In our deep-dive interview, ANZ Group Chief Economist Richard Yetsenga analyses how the Fed is placed after last week’s US inflation data.

5 things to know in 5 minutes:

1. Fed rake hike pricing retreated further on Friday after weak US retail sales in July. US stocks dropped. Looking ahead, the focus in Australia this week is July jobs data on Thursday and Q2 wage data Wednesday. ANZ Group Chief Economist Richard Yetsenga expects a small tick up in the unemployment rate to 4.5%.

2. Perhaps in a sign of declining activity in Australia that the RBA is looking for, housing lending fell 5% in the second quarter. ANZ Economist Maddy Dunk says the housing market has attracted the RBA’s attention recently.

3. New Zealand’s manufacturing industry expanded at a slower pace in July, according to the BNZ-Business NZ PMI. But ANZ Senior Economist Miles Workman says all five subindices remained in expansionary territory.

4. Evidence that New Zealand is not experiencing a straight-line recovery was in migration data for June. ANZ Senior Economist Matthew Galt says net migration was slightly lower in the month: Large numbers of inflows continue to be nearly matched by outflows, particularly to Australia.

5. A brighter spot for the New Zealand economy has been international tourism - a key services export. Matthew says there has been a steady grind upwards over the past few years.

Cheers,

Alex.

PS: Catch you tomorrow with a deep dive into ANZ Research’s new Australian house price forecasts.

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