Below trend growth to continue
Another busy week in Australia with the NAB Business Survey, Consumer Confidence and October Labour Force data all released.
Another busy week in Australia with the NAB Business Survey, Consumer Confidence and October Labour Force data all released. Markets are likely to continue to be significantly impacted by the stronger than expected US non-farm payrolls report on Friday night, which will see interest rates under upward pressure, a weaker $A against the US$, and less confidence in the RBA needing to further reduce Australian interest rates.
In our special focus this week, Peter Jolly, NAB’s Global Head of Research looks at something of an evolution in the RBA’s inflation targeting framework. A number of economists had looked for a rate cut last week on the back of lower than expected inflation, however, the Bank has importantly added the need for policy to contribute sustainably to growth into its decision-making framework in recent times. This is broadly in line with some of the academic debate overseas, where policy cannot simply focus on CPI inflation, but must also take broader macroeconomic stability into consideration.
For full analysis, download report:
• Australian Markets Weekly: Fed on track for December. (PDF,355KB)
For further FX, Interest rate and Commodities information visit nab.com.au/nabfinancialmarkets
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