Time to steer the ship
Today's news headlines:
‘Weakened Truss will try to convince Tories she can still deliver’. Just a month into her tenor as Prime Minister, Liz Truss can already feel the reins of power slipping through her fingers after a bruising few days. Her fiscal plan has exposed deep divisions in the Tory party, and she’s even weathered a mini rebellion from members of her newly formed Cabinet. Ahead of her Conservative Party conference speech today, Truss is under pressure to get her premiership back on track and deliver her vision of a tax-cutting, free-market Britain. (Bloomberg)
‘Fed telegraphs no Aussie-style policy pivot in inflation battle’. Markets were surprised to see a smaller-than-expected Reserve Bank of Australia rate hike On Tuesday, fuelling a global stock market rally. Still, other major central banks are unlikely to follow suit just yet. Federal Reserve officials have warned that their fight to bring inflation down to 2% will take more time, with Friday’s payroll report and monthly inflation figures providing guidance for its Nov 1st and 2nd meeting. A Fed pivot will likely come in early 2023, with markets betting that rates will peak at around 4.5% at the March meeting. (Bloomberg)
After a couple of strong days that saw the S&P 500 surge higher, equity futures in Europe and the US are lower this morning as markets await more concrete evidence that global interest rate hikes are set to slow. Major currencies were little changed overnight, with markets consolidating on yesterday’s Dollar weakness.
NZD RBNZ Cash Rate: 3.5% vs 3.00% previously
German Trade Balance: 1.2B vs 3.4B previously
OPEC-JMMC meetings: All day
US ADP Non-Farm Employment Change: 1.15pm
US ISM Services PMI: 3.00pm
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*Indicative interbank rates taken on the day of writing. Please speak to your Dealer to find out the current rates available for you.