What economics data grabbed the headlines last week?

Australian CPI

The Aussie Consumer Price Index (CPI) rose 1.8% this quarter.

Over the 12 months to the September 2022 quarter, the CPI rose 7.3%.

The most significant price rises were new dwelling purchases by owner-occupiers (+3.7%), gas and other household fuels (+10.9%) and furniture (+6.6%).

The quarterly CPI is Australia’s key measure of inflation, and is different to the newly published monthly CPI indicator.

The numbers for this quarter have created a headache for the RBA, which will make its next rates decision right on Melbourne Cup day (Tuesday Nov 2).

During the week, the Aussie dollar was boosted on the stronger-than-expected CPI, along with a weaker US dollar.

Upbeat numbers from the US

The latest GDP report shows the US economy grew at a better than expected annual rate of 2.6% in the third quarter, even though many signs point to a slowdown.

It was the first period of positive growth in 2022 following consecutive negative quarters to start the year, which has temporarily eased recession fears.

The growth came mainly due to a narrowing trade deficit, which economists expect to be a one-off occurrence given China’s current difficulties with exporting goods.

During the week, the US also released some upbeat numbers in consumer spending, non-residential fixed investment, as well as government spending.

The US core PCE (personal consumption expenditure) inflation, which is a core gauge of US inflation, accelerated in September – reinforcing the Fed’s case for another big (75bp) interest-rate hike on November 1.

The weekly jobless claims were also released last week, showing they edged higher to 217,000 but were still below the 220,000 estimate.

China’s belated GDP and other data

China released a smorgasbord of economics data last Monday.

The long awaited GDP data was finally released after a delay of one week. China’s GDP grew 3.9% from July to September YoY, beating expectations of 3.3%.

The country’s unemployment has however ticked up to 5.5% in September (versus 5.3% in August), and retail sales growth slowed to 2.5% in September (versus August’s 5.4% increase).

The weak numbers came following China’s Communist Party’s annual congress, which secured President Xi Jinping’s unprecedented third consecutive term as leader.

China’s economy is facing severe challenges as the country practically closed itself off from the global economy through strict Covid lockdowns.

The recent US export controls on microchips have also posed an existential crisis to China’s technology ambitions.

 

The Economic Calendar
Monday October 31 – Friday November 4

All sources from Commsec

The RBA and the Fed’s interest rate decisions will headline a busy week for investors.

Australia and New Zealand

MONDAY
Retail trade for September
Melbourne Institute inflation gauge for October
Private sector credit for September

TUESDAY
CoreLogic national home value index for October
RBA interest rates decision
RBA Governor Philip Lowe speech

WEDNESDAY
Building approvals for September
Lending indicators for September

THURSDAY
New vehicle starts for October
International trade for September

FRIDAY
Detailed retail trade for September quarter
RBA statement on monetary policy

Global

MONDAY
US Dallas Fed manufacturing index for October
China’s purchasing managers’ index for October

TUESDAY
US ISM manufacturing index for October
US JOLTS job openings for September
US construction spending for September

WEDNESDAY
US Fed interest rates decision
US ADP employment change for October

THURSDAY
US Challenger job cuts for October
US trade balance for September
US labour costs and productivity for September
US factory orders for September
US ISM services index for October

FRIDAY
US non-farm payrolls for October

 

The ASX IPO calendar for this week

 

Source Certain International (ASX:SC1)
Expected listing: 2 November
IPO: $7m at $0.20

The company provides a scientific provenance verification service for agriculture, seafood, mining and resource sectors.

SC1 says scientific analysis of physical product samples allows clients to mitigate risk, validate digital data, protect their brand and support transparency within their supply chains.

Taiton Resources (ASX:T88)
Expected listing: 4 November
IPO: $10m at $0.20

Taiton Resources is a mineral exploration and development company focusing on discovering mineral deposits.

The company strategy is to focus on uncovering mineral systems which have proven mineralisation.

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