Which economics data moved the needle last week?

This.

Fed speak

We heard plenty of speeches from Fed Reserve officials last week, but not from the head honcho Jerome Powell himself.

Fed Bank of Missouri Jimmy Bullard said it’s good the market is pricing in anticipated rate hikes, which should force the Fed Reserve to follow through to curb inflation.

“Inflation figures have continued to surprise to the upside, and rates should get closer to 4.5% or 4.75%,” Bullard said in a Bloomberg TV interview.

“That will make 2023 a disinflationary year.”

Bullard’s Minneapolis counterpart Neel Kashkari agreed, saying the Fed could pause rate hikes next year if they see evidence that inflation is slowing.

Meanwhile, New York Fed President John Williams said finding workers remains a challenge in the US economy.

At the moment, the US jobless rate is at 3.5%.

Among the unemployed, the number of permanent job losers decreased by 173,000 to 1.2 million in September, while the labor force participation rate was little changed at 62.3% in September.

Australian jobless

By comparison, the Aussie unemployment rate, which was released last week, remained at a 50-year low of 3.5% for the second consecutive month.

Digging deeper into the numbers, the participation rate was stuck at 66.6%, and just 900 jobs were added in September in an economy employing 13.6 million people.

Treasurer Jim Chalmers is expected to give his insights into where the jobless rate is headed at next Tuesday’s budget.

Minutes from the RBA’s October board meeting showed the central bank anticipated “a further decline in the unemployment rate over the months ahead”.

The minutes also said:

“Job vacancies and job advertisements were both at very high levels, suggesting a further decline in the unemployment rate over the months ahead.

“Beyond that, some increase in the unemployment rate was expected as economic growth slows.”

Fed Budget to be the focus this week

Treasurer Jim Chalmers has billed the upcoming budget as one that will “build a better future” for all Australians.

Social security (age pension, JobSeeker payments) would be one of the areas targeted by Chalmers, where he noted that $33 billion would be needed over the next four years.

Defence is set to get a $1 billion boost to recruit new personnel amid China’s challenge.

Among other sectors to receive new funding include health, infrastructure, and electric vehicles.

CBA’s chief economist Stephen Halmarick said he expects the Budget to result in a deficit of approximately $30bn-$40bn, or 1.2%-1.5% of GDP.

This is little change from the 2021/22 deficit of 1.4% of GDP, but will be substantially lower than the 2020/21 deficit of 6.5% of GDP.

“The budget position has improved over the past year because the economy has done better than previously expected,” Halmarick said.

“Companies are earning more revenue and there are more people employed, so tax receipts are higher.”

The Economic Calendar
Monday October 24 – Friday October 28

 

Australia and New Zealand

MONDAY
Australia manufacturing and services PMI
RBA assistant governor Kent speaks

TUESDAY
New Zealand Labour Day holiday

WEDNESDAY
Australian CPI for Q3
NZ business confidence index for October

THURSDAY
Australia export and import price index

Friday
Australian PPI for Q3

Global

(For US and EU, it will be on their time zone)

MONDAY
US manufacturing PMI
EU S&P global composite index
EU manufacturing PMI
EU S&P global composite index
China GDP for Q3
China industrial production for Q3
China retail sales for Sep
China unemployment rate

TUESDAY
US house price index for Aug
US Treasury Secretary Yellen speaks

WEDNESDAY
US MBA 30-year mortgage rate
US goods trade balance
US retail inventories
US crude oil inventories
US gasoline production
EU private sector loans for
China industrial profit

THURSDAY
EU’s European Central Bank interest rates decision
US GDP for Q3
US initial jobless claims
US PCE prices
US real consumer spending

FRIDAY
US core PCE price index
US personal spending and consumption
EU business and consumer survey
EU services and industrial sentiment

 

The ASX IPO calendar for this week

(Note: the ASX could change the listing dates without notice)

Toubani Resources (ASX:TRE)

IPO: $32.5m at $0.20

This resources player is focused on developing a gold platform in West Africa.

The company is primarily focused on the development of the Kobada Gold Project in Southern Mali, which has a global resource base of over 2.3 Moz of gold and the potential to produce more than 100,000 ounces of gold per annum.

Nightingale Intelligent Systems (ASX:NGL)
Listing: 24 October
IPO: $6m at $0.22

The company develops Unmanned Aerial Vehicles (UAV) for commercial applications. The first application chosen by Nightingale is physical security.

Omega Oil & Gas (ASX:OMA)
Listing: 25 October
IPO: $15m at $0.20

This O&G junior has two exploration permits in the Surat Basin in SouthEast Queensland, ATP 2037 and ATP 2038. The two permits represent an area of over 250,000 acres and are located approximately 50km away from critical gas transmission infrastructure.

The exploration program will explore the Permian Deep Gas play which, if successful, represents a potential multi-TCF gas resource.

H&G High Conviction (ASX:HCF)
Listing: 25 October
IPO: $30m
Price: NAV per Share as at 5.00pm Sydney time

In June, H&G High Conviction was formed and acquired  its initial investment portfolio of cash and ASX-listed securities in exchange for shares in H&G High Conviction.

Approximately 75% in value of the initial investment portfolio was acquired from the H&G High Conviction Fund.

 

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