A solid growth in mineral exports and lower imports due to coronavirus-affected supply chains has resulted in Australia’s trade surplus more than doubling in March to a seasonally adjusted $10.6 billion.
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As expected retail sales were strong in March, despite the rapid spread of lockdowns designed to slow the COVID-19 pandemic but they ended up stronger than the first estimate issued a couple of weeks ago by the Australian Bureau of Statistics.
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Three things suggest Australia looks likely to come through this period of global misery relatively well compared to many other countries.
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No change in interest rates from the Reserve Bank – an expected outcome from the May meeting yesterday but we got more bad news about the damage being done to the economy by the COVID-19 related lockdowns.
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As has been expected job advertisements collapsed in April as lockdowns closed business across the economy and job support schemes emerged with delays to the actual handing out of money, but building approvals in March held up better than forecast, according to data released yesterday.
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Solutions to appease the crisis face political hurdles. A default or euro exit are possible.
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China’s services activity expanded at a faster pace in April, but business manufacturing seemingly slowed a touch, according to the two official surveys of activity across the world’s second-largest economy.
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Looking at the data released this week, you can understand why the Bank of Japan moved to an even easier monetary policy stance at its truncated one-day meeting on Monday.
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The March quarter’s Consumer Price Index gave us a hint of what might have been had the COVID-19 pandemic not hit, but the data also confirmed that apart from government-driven charges for tobacco and alcohol costs and private health care, the 0.3% quarter on quarter and 2.2% annual reading would have been much lower.
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An understanding of the government’s political motivations and willingness to keep the economy on life support may highlight investment opportunities.
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Optimism about New Zealand in the recovery from the current slump from global ratings agency Moody’s. The ratings group says NZ’s low Government debt puts it in a good position to navigate the recovery from the COVID-19 disruption.
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While the BOJ kept its interest rate targets unchanged, as had been widely expected, it pledged to buy an unlimited amount of bonds to keep borrowing costs low as the Abe government tries belatedly to spend its way out of the deepening economic pain from the coronavirus pandemic.
Read MoreAfter weak indicators for Australian car sales, jobs and wages, but a strong showing for retail sales, it’s time for the release of one of the top tier bits of data – the quarterly consumer price index on Wednesday.
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The dramatic plunge in economic activity across economies large and small became clearer on Thursday with the release of preliminary results of surveys of manufacturing and service sector activity with the readings plunging to record lows.
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A rush to stockpile groceries and office supplies ahead of looming COVID-19 lockdown measures pushed retail turnover up by a monthly record of 8.2% in March.
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Reserve Bank governor Philip Lowe has given the strongest (and gloomiest) forecasts for the looming hit to Australian economic activity from the COVID-19 pandemic and measures governments have taken to control its spread.
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As expected China cut its key loan prime rates (LPR) on Monday but that that still leaves the rates the highest among major economies.
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The coronavirus pandemic has brought China’s extraordinary run of economic growth to an end — a stark reminder of the enormous task ahead for world leaders trying to restart the global economy.
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This note looks at what QE is and how it entails printing money, why it’s being used and what the risks are.
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The March jobless data has provided us with a first, very small glimpse of the impact on the Australian economy from the COVID-19 pandemic.
Read MoreThe People’s Bank of China (PBOC) said it was lowering the one-year medium-term lending facility (MLF) loans to financial institutions to 2.95%, the lowest since the liquidity tool was introduced in September 2014, down 20 basis points from 3.15% previously.
Read MoreWhile not as dramatic as the falls in January and February, March saw China’s imports and exports once again drop, as the coronavirus pandemic continued to wreak havoc inside the country and on its major customers offshore
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The NAB says we had better prepare ourselves for what its chief economist says will be “a recession of unprecedented speed and magnitude”.
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Inflation eased in March in China and the US in a glimpse of the impact the COVID-19 pandemic and the slump in oil prices are having on the world’s two biggest economies.
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China’s carmakers and sellers suffered their worst ever quarter in three months to the end of March, as the coronavirus pandemic closed factories and dealerships for several weeks, and wiped out consumer demand.
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Well, that’s not really new news is it, that ratings agency S&P Global is putting Australia’s triple-A credit rating on negative outlook, saying there had been a “substantial deterioration” in the country’s finances and which is now facing the risk of a deep recession.
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The Reserve Bank has warned that the Australian economy faces a “very large economic contraction” in the current June quarter.
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More evidence of the slowdown gathering strength across the economy with the Australian Bureau of Statistics revealing that 66% of Australian businesses have felt some impact from the COVID-19 pandemic and its fallout on demand.
Read MoreTomorrow’s Reserve Bank board meeting looks anti-climatic. The central bank will be looking for a rest after its busy March when it cut the cash rate to a record low of 0.25% and put in place a series of supports for the financial system to allow it to flex as pressure from the COVID-19 pandemic started slamming into it.
Read MoreNow for the slowdown which could be the worst America has had outside the Great Depression as more than 6 million made their first jobless benefit claims last week – a record number in fact that followed an earlier record the week before.
Read MoreChina’s second survey of manufacturing activity last month rose back into positive territory, as did the official survey on Tuesday but the make up of the recovery wasn’t convincing and the weaknesses of these types of surveys were again exposed.
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China’s economy stabilised in March, recovering after taking an enormous hit due to attempts to stop the spread of the coronavirus during February.
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The Morrison’s governments’ third COVID-19 support package, is the biggest so far with over $130 billion on offer to support the wages of up to six million Australian’s through the current crisis.
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The Reserve Bank of New Zealand announced on Monday that it was planning to start buying corporate bonds from banks this week to keep business well supplied with liquidity
Read MoreThe bottom line is that while we may see the biggest hit to global and Australian GDP since the 1930s thanks to the shutdowns, there are big differences compared to the Depression suggesting that a long drawn out global downturn is not inevitable.
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More than 3 million people filed a claim for unemployment benefits last week in the US as the COVID-19 pandemic closed businesses, cities and entire American states.
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Tens of thousands of jobs across the economy continue to be lost as the Australian Bureau of Statistics said yesterday that one survey had found that half of Australian businesses have reported an adverse impact because of the coronavirus pandemic with 86% expecting to be hit in coming months.
Read MoreAt 3.30 am Sydney time on this Friday, we will get confirmation that the world’s biggest economy had been brought to a dramatic and brutal halt by the coronavirus pandemic. That’s when the initial jobless claims for last week will be reported by the US Labor Department.
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The coronavirus pandemic & associated shutdowns to economic activity now poses a significant threat to the outlook for property prices. The question is how big the threat is?
Read MoreThe RBA has rolled out a series of measures that it hopes will help Australia “build a bridge” and eventually bounce back from the current disaster. Expect the low cash rate of 0.25% to be around for at least three years as the COVID-19 pandemic wreaks havoc on the local and global economy.
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