Friday 16th July 2021Markets returned to a more cautious outlook overnight, with US equities losing ground and bond yields falling. As NAB’s David de Garis explains, its difficult to find any particular reason for the change in sentiment, other than a return to concerns over COVID and the speed of economic recovery. There wasn’t anything in day two of Jerome Powell’s testimonies to cause concern and US data overnight was largely positive. The Aussie dollar felt the impact of the mood of the day, even though there was a very strong set of employment numbers yesterday. The UK’s employment numbers told a different story. And data from China suggest the slowdown is not as bad as feared, but likely to be enough to spark more stimulus from the PBoC. Today, the NZ CPI read will be the focus of attention.

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