The Australian unemployment rate stands at 5.2% and is expected to have risen to 8.2% in April. Nonetheless, Australia’s labor market slack is slated to rise less than in the US because Australia has been able to control…
Highlights Inflation-Linked Bonds: The plunging price of oil has put renewed downward pressure on global bond yields via lower inflation expectations. With oil prices set to recover over the next 6-12 months as the global economy…
Australia had managed the near-impossible feat of avoiding a recession since 1990/91. Even during the global post-GFC recession, the Australian economy avoided a contraction of two quarters or more thanks to the automatic…
Highlights Oil prices are up strongly from their lows, but conditions for a durable bottom may not yet be in place. The main hiccup is that an air pocket will likely remain under global oil demand until most social-distancing measures…
The Australian dollar has been trading below the lows seen during the Great Financial Crisis in recent days. Having touched an intra-day low of 55 cents, the latest selloff represents a peak-to-trough decline of around 50%. We…
Highlights The pillars of dollar support continue to fall, but the missing catalyst is visibility on the trajectory of global growth. For now, we remain constructive on the DXY short term, but bearish longer term. Market internals…
Highlights Policy Responses: The COVID-19 pandemic has become a full-blown global crisis and recession. Governments and central bankers worldwide are now responding with aggressive monetary easing and fiscal stimulus. Markets will not…
Since February 20th, the US dollar has significantly weakened as market participants increasingly bet on large interest rate cuts by the Fed. The euro and the yen have so far been the prime beneficiaries of this move, helped by…
Highlights The elevated uncertainty about global growth stemming from the COVID-19 virus in China has not only made investors more anxious, but central bankers as well. This means that, only six weeks into the year, policymakers may…
The latest RBA minutes revealed a dovish tilt at the February 5 meeting. Domestically, household consumption was a major source of concern. Combined with the bush fires and China slowdown, the outlook for near-term growth was…