In this section, we look at the economic news affecting global markets this week.

Australia

  • The RBA has left interest rates on hold, surprise surprise. The official cash rate remains at 1.50% for the 14th consecutive month, still above the global average. The RBA this time, seemed a little standoffish from offering any indication on where rates were heading. It is instead waiting for the housing market to cool and for a rebound in inflation to take place. It expects the current low rate of inflation to gradually increase as economic growth improves. Its forecasts were left unchanged. GDP to average 3% over the next few years. Markets aren’t pricing in another rate cut until February 2019 at 1.75%.
  • Investor lending fell 6.2% in September compared with the previous month. Owner-occupier lending fell 2.1%. The only rise was from first-home buyers which was up 0.2%, hitting a 4.5 year high.


US

  • US commercial property insurance rates are tipped to rise by up to 25% during 2018 for properties that suffered catastrophe losses this year caused by hurricanes Harvey, Irma and Maria.
  • Those who filed for unemployment assistance increased more than expected. The number was up by 10,000 to a seasonally adjusted 239,000 from the previous week’s total of 229,000. Analysts expected jobless claims to increase by 2,000 to 231,000 last week.

Europe

  • The IHS Markit’s final composite Purchasing Managers’ Index for the euro zone fell to 56 in October from September’s 56.7 but remains well above the 50 mark in growth mode.

China

  • China’s trade surplus with the US has fallen. It fell from US$28.1bn to US$26.6bn.
  • Inflation rose to 1.9% in October from a year earlier, beating market expectations for a 1.8% rise.
  • Producer prices rose 6.9% on-year, unchanged from previous month’s increase. Analysts were tipping a 6.6% rise.

Japan

  • Wages fell by 0.1% in September which is down for the fourth straight month.