NAB Morning Call

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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Tuesday 10th December 2024

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Beijing has announced more in the way of fiscal and monetary stimulus to get the Chinese economy back on its feet. NAB’s Ken Crompton says it’s still light on the detail, but it caught markets a little off-guard, with nothing expected till later in the week. The response was most pronounced in Chinese equities, but oil is also higher and so is the Australia and NZ dollars.  Today the RBA is likely to announce that rates won’t budge, but the detail will come from the press conference that follows. The NAB Business Survey is also out today.

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Monday 9th December 2024

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We can expect three central banks to cut rates this week, and one to hold steady. No surprises that the RBA is the one firmly expect to stand pat, but NAB’s Taylor Nugent says a higher-than-expected unemployment rate in Canada saw pricing increase for a 50bpcut by the Bank of Canada this week. Friday’s US non-farm payrolls also increased slightly expectations for a 25bp cut by the Fed next week. US CPI numbers are out middle of the week, but Fed speakers won’t be able to comment with the pre-meeting lockdown in place. The Aussie dollar was the worst performer of the major currencies last week, in part because of Aussie GDP numbers, but also because of global geopolitical uncertainty. There’s even more of that now with the collapse of the Assad regime in Syria and the unknown implications from of the power vacuum it creates.

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Friday 6th December 2024

Please note this communication is not a research report and has not been prepared by NAB Research analysts. Read the full disclaimer here.

Have Australians who ignored the rise of the Magnificent Seven lost out? NAB’s Gemma Dale says they will have still done pretty well with Australian equities, which have performed better than many other parts of the world, like the UK and Europe, for example. But how will investors cope with the uncertainties of the next 12 months? How do you plan for Trump’s trade policies, subsequent changes to supply chains and the rising US dollar? How do you look for winners  before they hit the big time? Or do you, as many Aussie investors tend to, simply look for opportunities and buy the dip. Phil talks to Gemma about the year we’ve been through for Australian equity investors and what the next year will bring.  

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Friday 6th December 2024

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The US releases non-farm payrolls data later today, but NAB’s Rodrigo Catril says if anything is going to shift expectations for a cut by the Fed this month it will be the upcoming CPI data. Meanwhile words from Jerome Powell, that the economy was doing better than expected, can be added to the list of reasons for a pause in the new year. A new PM for France hasn’t been decided yet but will be in the next few days. The turmoil just adds to the European woes, with more lacklustre data over the last 24 hour. And OPEC+, as expected, has pushed back the increase in production and the length of the ramp in those increases.

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Thursday 5th December 2024

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Australia’s growth numbers yesterday were a bit slower than most had expected, although in-line with NAB’s expectations. Nonetheless it was below consensus and NAB’s Gavin Friend says that was brought forward expectations for a rate cut, although that could easily slip back. The short-term impact has been a weaker Aussie dollar against a US dollar which itself falling after a downside surprise on the Services ISM read overnight. A rare bit of soft US economic data, says Gavin. As we pressed record today France was going to vote on the government’s no-confidence motion, whilst Jerome Powell was taking part in a panel discussion that markets have been holding out for. We cover off some of the early take-outs from both.

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Wednesday 4th December 2024

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It was a hectic session for geopolitics but, as NAB’s Skye Masters discusses, it hasn’t had much impact on markets. There wasn’t much of a reaction to the imposition of martial law in Korea, which was shortly afterwards overturned by parliament, but placing a question mark over the political life of the President. France has it’s no-confidence vote today, but European uncertainty seems to be priced in. In the US markets paid more attention to the Fed’s Christopher Waller than the rise in job openings and quits. Tonight, Jerome Powell could seal-the-deal as far, as markets are concerned, for a December rate cut. Locally, Australian GDP is the key number.

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