Oz wrap up
We’ve spent the past few months focused on the US, but with the end of the year fast approaching it seems like a good time for an update on Australia.
This week we will see the release of Australian GDP numbers, which we expect will have stagnated in the third quarter. However, a soft GDP report will go some way to reducing speculation that the RBA will raise rates next year.
We also expect to learn this week that the sharp narrowing in Australia's trade deficit will continue. While Australia's current account should narrow sharply early next year as the rise in commodity prices boosts the value of exports. This will be good for the government deficit and good for the country.
- sponsor - Wealth Know How
Wealth Know How is the online network helping people manage their wealth through financial education. Whether you are looking for simple ways to better manage your cash, or you are after a complete strategy on how to save for retirement, we can help you understand your options. It is important to have a vision for your future, but its knowledge not dreams that will ultimately deliver financial success.
Published on 09 Dec 16
-
-
Venezuela tension heats up
Duration 03:16
-
Aussie dollar surprises market
Duration 03:10
-
Markets climb as investors watch US healt...
Duration 02:31
-
-
We’ve spent the past few months focused on the US, but with the end of the year fast approaching it seems like a good time for an update on Australia.
This week we will see the release of Australian GDP numbers, which we expect will have stagnated in the third quarter. However, a soft GDP report will go some way to reducing speculation that the RBA will raise rates next year.
We also expect to learn this week that the sharp narrowing in Australia's trade deficit will continue. While Australia's current account should narrow sharply early next year as the rise in commodity prices boosts the value of exports. This will be good for the government deficit and good for the country.Sponsor - Wealth Know How
Wealth Know How is the online network helping people manage their wealth through financial education. Whether you are looking for simple ways to better manage your cash, or you are after a complete strategy on how to save for retirement, we can help you understand your options. It is important to have a vision for your future, but its knowledge not dreams that will ultimately deliver financial success.
-
Venezuela tension heats up
Duration 03:16
-
Aussie dollar surprises market
Duration 03:10
-
Markets climb as investors watch US healthcare bill
Duration 02:31
This week we will see the release of Australian GDP numbers, which we expect will have stagnated in the third quarter. However, a soft GDP report will go some way to reducing speculation that the RBA will raise rates next year.
We also expect to learn this week that the sharp narrowing in Australia's trade deficit will continue. While Australia's current account should narrow sharply early next year as the rise in commodity prices boosts the value of exports. This will be good for the government deficit and good for the country.
Consumer confidence also suggests that retail sales in Australia are continuing to grow. And with labour market conditions unlikely to deteriorate much further, we don't expect retail sales to weaken much more in the coming months.
Global oil prices jumped as much as 19% last week as OPEC finalised an agreement to cut production. It’s a big number but not as big a deal as the headlines imply.
Prices are only a little higher than they were in October – shortly after an output cut was first discussed. As such, it’s really only a small positive for energy producers and a small negative for consumers.
Of course, doubts about the deal have not gone away. It remains to be seen whether OPEC will deliver the promised output cuts, given its record of poor compliance. Support for the deal also appears to depend on friendly non-OPEC countries cutting their production too. Russia may not prove a reliable partner.
There was very little reaction in global markets to the US Employment Report released on Friday and we think the Fed remains on track to deliver a 25 basis point rate hike later this month.
The S&P500 is only up over 2% since the election. There has been huge rotation out of defensive and technology stocks into Banks, Energy and Materials. This is yet to benefit the Australian market as much as it should. In emerging markets however we are seeing the beginning of a strong rally in commodity exporters.