Friday 20th December 2024

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It’s been a year of surprises. US exceptionalism has long been talked about, but this year it particularly exceptional, particularly in relation to the rest of the world. Growth has picked up, the dollar has strengthened, and the share market has repeatedly hit new highs, driven by Trump, tech and the AI revolution. So, what does 2025 have in store?

The entire NAB Morning Call team - Sally, Skye, Ray, Rodrigo, Gavin, Tapas, Taylor and Ken - join Phil to crystal ball gaze on 2025. Will Trump push ahead with his tariff threat? What will that mean for international trade? Will China manage to find the ways and means to stimulate its domestic economy and, it not, what’s the impact on the CNY and the Aussie dollar? Could the Aussie fall below 60 US cents next year?

They also discuss the path of central banks next year. Speculation has been rife this year about who will cut when and by how far. There’s no clear agreement on the neutral rate that each bank is striving for. Does that mean we’ll see smaller movement in bond market.

A myriad of questions tackled in this special 40-minute episode, the final Morning Call of 2024. We’re back on January 13th, by the way. Usual time.

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Friday 20th December 2024

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As we recovered in the later editions of the Morning Call yesterday there was a strong market response to the Fed yesterday -from the statement and the press conference. As NAB’s Taylor Nugent explains, there’s been a slight reversal in equity markets today, but nothing significant, and the US dollar continues to push higher. Since then, the Bank of Japan has done as expected, but still managed to weaken the Yen, perhaps because some are now wondering whether a rate rise won’t happen until March. The Bank of England kept on hold, but with a divided board. The Norges Bank and Riksbank did as expected. Meanwhile a s surprise in yesterday’s New Zealand GDP. Good news or bad? 

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Thursday 19th December 2024

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The Fed has cut interest rates as expected, and they have halved the number of cuts they expect next year. As NAB’s Gavin Friend points out, there was only one dissenter, wanting to keep rates on hold. That seems highly likely next time, as the Fed dot plot sees just two cuts next year, eventually aiming for an expected neutral rate close to 3 percent.

Also, UK CPI didn’t surprise, and the Bank of England isn’t expected to either, keeping rates on hold, as inflationary pressures, though falling, remain high. The Bank of Japan also meets today. Another case of hold, but an expectation of a small rise early next year. And New Zealand’s economy is expected to show a second quarterly decline this morning.  

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Wednesday 17th December 2024

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Markets were surprised overnight by the increased in UK wages. Alongside the weakness in European data lately, the yield spread between the UK and Germany is now at its highest level since the reunification of Germany in 1990. Other data was less surprising. US retail sales rose, but as much as many had anticipated. Canada’s inflation fell. Aussie consumer confidence was down a little, but not by much and after two months of solid growth. NAB’s Skye Masters talks through the day’s news and looks ahead to the Fed meeting. What could surprise the markets this time tomorrow?

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Monday 16th December 2024

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US growth continues to lead the way. The latest PMIs showed services growth for Europe and the UK, but not as much as the US. In all cases, though, there’s a fall in the manufacturing PMI. The US strength helped push equities higher - with new highs for the NASDAQ and S&P - and strengthened the US dollar and pushed Treasury yields higher. The data doesn’t stop flowing, even though it’s only a week till Christmas. UK employment data today might do little to influence the Bank of England this week, but if wages growth remains high it’ll support their reticence to cut too quickly. Australian consumer confidence is out today as well. NAB’s Taylor Nugent talks through the numbers.

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Monday 16th December 2024

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The Fed and four other central banks meet this week. NAB’s Ray Attrill says the Fed and the Riksbank will cut rates, whilst the Bank of England, the Bank of Japan and the Norges Bank will all keep rates on hold. Today PMIs are released, which are likely to show a widening gap between US exceptionalism and European gloom. France has a new Prime Minister and Moody’s joining the agencies downgrading their credit rating, assuming the government will be able to do very little to reduce debt in the short term.

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Friday 6th December 2024

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Next year the Australian economy will see slow and measured improvement, according to NAB's CEO Andrew Irvine. It’ll be boosted, though, by the first rate cut, which Andrew says will have a significant impact on the psyche of businesses and consumers.

In his first appearance on The Morning Call the NAB boss talks about housing affordability, productivity and how NAB will stand up against its competitors in the banking sector. He gives his views on where Australia will stand in five years’ time, the opportunities we need to engage with, and what’s holding the country back.

In many cases he shares his observations of Australia in relation to Canada, a country he knows well. When it comes to productivity and housing, he thinks we can learn a few things. But he admits, the coffee is a lot better here.

Join Phil talking to Andrew Irvine in his first at-length interview since taking the role.

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Friday 13th December 2024

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Today, NAB’s Taylor Nugent talks through the market response to the unexpected fall in Australian unemployment numbers yesterday, with the drop most significant in Victoria. The Swiss National Bank provided another surprise, with a 50bp rate cut, with a 25bp cut from the ECB, accompanied by lacklustre growth forecasts for the next few years. Today, the RBA’s Sarah Hunter is speaking at a lunch in Adelaide, with a Q&A session where the media will undoubtedly ask about the fall in unemployment and how that impacts their rate cut trajectory.

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Thursday 12th December 2024

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US equities pushed higher today as US CPI provided no surprises, or any reason for the fed to deviate from their expected rate cut next week. The Bank of Canada managed a 50bp rate cut yesterday, but it’s likely that cuts will be less frequent and smaller now, as they try to find the neutral rate. The Swiss National Bank, managing an economy that suffered very little from the blight of inflation, could well engineer a 50bp cut today as well. Meanwhile, NAB’s Gavin Friend suggests the ECB, who are expected to cut again today, could move into stimulatory territory next year. Locally, all eyes will be on Australia’s employment data.

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Wednesday 11th December 2024

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Markets have responded to what some have seen as a dovish pivot by the RBA, in the wording of their statement yesterday and the post-meeting press conference. But JBWere’s Sally Auld says there are still inflation concerns, hence NAB is sticking with its expectation that a cut probably won’t happen till May. Still, the Aussie and NZ dollars both took a hit yesterday and are still well down this morning. The US dollar, meanwhile, has been boosted by a sharp rise in small business sentiment in the latest NFIB survey. It’s clearly a Trump bounce. Will his delivery match expectations? And the second dove of Christmas? Well, presumably the Bank of Canada. You can’t get more dovish than a 50bp rate cut, which is what’s expected tonight.

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