NAB Morning Call

Monday 28th July 2025

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President Trump announced a trade deal with the EU on Sunday, that sees a 15% tariff on most goods, cars included. Aluminium and steel remain at 50%. In exchange, according to Bloomberg, Europe will not levy any tariffs and will invest an extra $600bn in the US and spend $750bn on US energy. The deadline for a China deal also seems to have been pushed back 90 days. NAB’s Rodrigo Catril talks through the likely market reaction today, with equities already elevated on Friday from earnings results and some significant earnings results in the week ahead. Also on Friday the US President indicated that it would be too problematic to fire Jerome Powell, but will he still hold that opinion when the Fed holds rates again this week?

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Friday 25th July 2025

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This week Rod Sims, chair of the think tank The Super Power Institute, joins Phil to talk about Australia’s green iron opportunity. He says we have all the ingredients – the raw materials and the environment – to produce green iron, rather than shipping iron ore and coking coal overseas for carbon-intensive processing. But he admits in the short-term Australian produced green iron will be a more expensive proposition for markets like China and, in the absence of global carbon pricing, the government will need to step in with subsidies. The long-term opportunity, though, will make it all worthwhile. The Institute's own figures suggest green iron could generate $386 billion annually in exports by 2060, compared to around $120 billion now for iron ore. That requires a strategy and deep pockets from the government. Phil asks, are they on board with this?

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Friday 25th July 2025

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President Trump is stepping up the pressure on Jerome Powell as he ‘drops by’ the Fed, before heading off to the UK for the weekend. Markets have been a little more concerned about PMIs and central banks, though. The ECB kept rates on hold but, as NAB’s Ray Attrill point out, Christine Lagarde was hawkish in the press conference. Phil asks if he could have seen the last rate cut in this cycle. Meanwhile Michelle Bullock reiterated the cautious approach of the RBA at a lunch in Sydney yesterday. As far as PMIs are concerned, the US did better than Europe, with the UK the clear loser. Today UK retail sales will be of interest, along with durable goods orders in the US. Plus, of course, earnings and tariff news. 

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Thursday 24th July 2025

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Japan has a deal, even if the details right now seem a little sketchy. NAB’s Gavin Friend joins Phil to talk through an arrangement that sees Japan’s exports taxed at 15%, a welcome reduction for the country’s automakers. There are murmurs that the EU will reach a similar deal. Ironically the speed at which the deal was reached in Japan could see pressure mounting on PM Shigeru Ishiba to step down sooner rather than later. Also today why Alphabet shares are well down in after hours trade whilst Tesla has risen.

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Wednesday 23rd July 2025

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Tech earnings will be a focus of the week, with Tesla, IBM and Alphabet a day away now. But markets have responded favourably to earnings results so far, including a strong result from Coca Cola. But, as NAB’s Tapas Strickland points out in today’s podcast, it was a different story for GM, who took a hit on their income to absorb the cost of tariffs on imported cars and parts. Meanwhile a new trade deal with the Philippines provided further evidence that any country wil be lucky to get away with the original Liberation Day 10 percent baseline. Tapas also picks the bones on the latest RBA minutes, which highlighted how the central bank is treading cautiously because it is uncertain of the terminal rate.

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Tuesday 22nd July 2025

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US equities rose to new highs in this session, buoyed by positive earnings results, but pulled back, perhaps on the reality check that Liberation Day Mark 2 is a little over a week away, The European Commission has said they will be meeting early next week to discuss counter measures if a deal isn’t reached with the US. Scott Bessent has also suggested secondary tariffs will be more seriously applied to a deal with China. NAB’s Taylor Nugent joins Phil to talk through the latest trade developments, plus the follow-through from Japan’s election result, yesterday’s New Zealand CPI and what central bankers might be saying today.

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Monday 21st July 2025

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It looks like Japan’s Prime Minister Ishiba has lost his majority, according to exit polls on Sunday. NAB’s Skye Masters says it was already priced into markets, with 30-year bond yields reaching record highs last week, but it comes at a bad time as Japan tries to negotiate a trade deal with the US, with the 1st August deadline looming. A deal might be reached with the EU this week or next, but President Trump has indicated he is inclined to a base tariff of 15 – 20%, even with a deal. A low level of data means the focus this week will be on tariff news, and corporate earnings, including Tesla and Alphabet in the middle of the week.

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Friday 18th July 2025

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Who is going to ultimately benefit from Donald Trump’s policies – the tariffs and the bIg Beautiful Bill. Phil Dobbie talks to economist Phil Suttle, in Washington DC, about the future for the US economy and the impact on tariffs om the global economy. The uncertainty will almost certainly slow down US investment, the exception being the tech sector where the FOMO effect will keep companies developing. Phil reckons there will be a haves and have nots divide, in households and in the corporate space. But what about the rest of the world? How will China and Europe adapt? And can we expect a permanent shift in global trade patterns, or will we revert to norm once President Trump has moved on?

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Friday 18th July 2025

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The S&P hit a new high today, passing 65,300for the first time. Why? Well, the economic data out over night was largely good news. Retail sales were stronger than expected in June, the Philly Fed Manufacturing Index perked up, initial jobless claims fell. As Phil suggests to NAB’s Gavin Friend, there was a lot to like. The threat of looming tariffs seems to be largely ignored, as though investors don’t think they will happen. It was a less rosy picture in Australia and the UK -in both cases unemployment rose more than expected. Gavin talks through whether these numbers will have any impact on central bank decisions.

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Thursday17th July 2025

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Donald Trump made a TV career from firing people and there has been increasing speculation lately that he is ready to dump the Fed chair. That speculation was heightened on Wednesday when lawmakers claimed he had pointed to a letter asking Jerome Powell to leave. But he denied that when quizzed by the press, saying he’ll only go if he had to because of fraud. As NAB’s Taylor Nugent describes, markets swung back and forth on the unfolding story but finished with the stock market regaining ground at the close. Also on the podcast, rising inflation in the UK and Australian employment data today alongside some key US metrics.

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