NAB Morning Call

Wednesday 26th June 2024NAB Markets Research Disclaimer Financial Services Guide | Information on our services - NABCanada’s inflation came in hotter than expected in May and that’s pushed up Canadian bond yields overnight, but there’s been limited reaction to that – or anything really – on currency markets. NAB’s Taylor Nugent says the print has pushed back expectations for the Bank of Canada to cut again in July. What happens next depends on the data. We get more Australian data today, with the CPI print for May and a speech by the RBA’s Chrisopher Kent. 

Tuesday 25th June 2024NAB Markets Research Disclaimer Financial Services Guide | Information on our services - NABThere are three broad themes on today’s podcast. First, a missed day on US equities again, with falls in the S&P and NASDAQ. NVIDIA shares are well down, but even a minor correction is only a deny in their upward trajectory this year. There’s also the divide between the European and US economies, evidenced by last weeks PMIs. But is the difference really that great. NAB’s Rodrigo Catril agrees with the ECB’S Isabel Schnabel that, when it coms to fighting inflation, they’re not that far apart so it would be wrong to assume a divergence in policy by the two central banks. The other theme is the continued fall in the Yen and the repercussions it could have across the region, including the Australian dollar.

Monday 24th June 2024NAB Markets Research Disclaimer Financial Services Guide | Information on our services - NABPMIs on Friday continued to show the dichotomy between Europe and the US. Even within Europe we saw clear evidence of the weakness within Germany. Phil asks NAB’s Tapas Strickland what these latest PMI numbers mean for central banks. Could the strong US print delay the Fed into next year, whilst providing the reasoning for the ECB to perhaps move a little faster? It all depends on the inflation data, of course. And we don’t have to wait long for that, with thew Fed’s preferred measure, the core PCE deflator out at the end of the week and European CPIs ahead of that. 

Friday 21st June 2024Please note this communication is not a research report and has not been prepared by NAB Research analysts. Read the full disclaimer here.Markets reacted rather swiftly to the news that President Macron had called a snap election for France, just after his own party had been heavily beaten in the European elections by Marine Le Pen’s Front National. This week Phil talks to Anne Bucher, from Bruegel, an independent European economic think tank. Anne is a former Director-General in the European Commission until October 2020 – in fact, she joined the commission in 1983 working across a wide variety of policy areas over may years. She has an innate knowledge of European politics.So, how does she see the French situation play out? Can we expect the more extreme elements of the Front National agenda to be watered down? Has the UK’s Liz Truss moment served as a warning bell for any party promoting higher debt?Whilst we can expect some compromise, Anne says the big casualty will be progress. As the EU fights battles with the right it’ll struggle to develop a cohesive plan for growth and climate change.

Friday 21st June 2024NAB Markets Research Disclaimer Financial Services Guide | Information on our services - NABEurope is in the midst of the group rounds of the Euros, but when it comes to central bank cuts Switzerland is already the champion, with Britain the favourite to cut next. JBWere’s Sally Auld talks through yesterday’s decisions by the Bank of England, the Swiss National Bank and the Norge’s Bank. In the US markets seemed unfazed by Neel Kashkari’s claims that hitting the Fed’s inflation target might take a year or two. Perhaps his views were surpassed by more soft data overnight, including another rise in jobless claims. New Zealand’s GDP was a little higher than expected, but it won’t last, says Sally. And tonight the PMI data-dump for Germany, France, the Euro area, the UK and the US.

Thursday 20th June 2024NAB Markets Research Disclaimer Financial Services Guide | Information on our services - NABThe UK, which has seen inflation rise to one of the highest levels, is also one of the first to get it down to target, with the headline rate down at 2% yesterday. Even so, the Bank of England won’t cut rates when they meet today, although perhaps three members of the panel might call for it. Het markets are now fully pricing the first cut at the back end of the year. NAB is expecting August. NAB’s Gavin Friend explains why the variety of opinions and expectations. He also talks about the EU’s plans to implement penalties for the large number of member states who are holding too much debt. Meanwhile, the Norges Bank and Swiss National bank meet today. He Swiss re expected to cut rates and win a football match.

Wednesday 19th June 2024NAB Markets Research Disclaimer Financial Services Guide | Information on our services - NABThe most valuable company in the world is not Apple or Microsoft. It's NVIDIA. Can anyone stop them? Meanwhile, the RBA kept rates on hold but in a way that was more hawkish that expected. NAB’s Rodrigo Catril says the committee even discussed the potential for rate hikes. NAB still expects a cut in November, nonetheless. In the US retail sales were weaker whilst government spending rose. Could all this extra government spending delay the fall in US inflation? Today UK CPI numbers are released and the US takes the day off, keeping NVIDIA on top for another 24 hours.

Tuesday 18th June 2024NAB Markets Research Disclaimer Financial Services Guide | Information on our services - NABFrench politics still has a long way to run, but markets have calmed down a bit on the hope that a LePen government might not be so radical. NAB’s Taylor Nugent says ECB chief economist calmed markets by suggesting there was nothing disorderly in bond markets that would see the need for the central bank to intervene. It’s going to be an uneventful RBA meeting today, with rates on hold and no new forecasts to map out the path of cuts for this year and next. All in all, a fairly quiet session. Except US equities, of course, that broke records, again.

Monday 17th June 2024NAB Markets Research Disclaimer Financial Services Guide | Information on our services - NABLast week was dominated by two big stories. First ,the dichotomy between US inflation data and the downgrade of rate cuts predicted by the Fed. Secondly, the snap French election , which could turn about to be very bad news for President Macron. NAB’s Ray Attrill talks through the market reaction to both by the end of the week, along with a sprinkling of data from Friday, the BoJ meeting and loan data from China. This week we hear rate decisions for the RBA, the BoE, the Swiss National Bank and the Norge’s Bank. Ray explains which one might cut.