20 Apr 2018
Aussie unemployment rate pushes higher
Markets
- Local and global equity markets rose this week as trade war fears and Russian retaliation fears subsided.
- In local stock news, toll operator Transurban’s average traffic volumes increased by more than 3% in the March quarter in Sydney and Melbourne.
- Rio Tinto reported a 5% rise in exports of iron ore from its Australian mines due to fewer weather related setbacks and continued productivity improvements. Production from the Pilbara region rose 8% on the same time last year.
- Sydney Airport reported strong March passenger numbers, which were boosted by an earlier Easter holiday period. Domestic growth was 3.5% whilst international growth surged over 11% in the month, with strong contributions from Indian, Chinese, South Korean and US visitors.
- The International Energy Administration stated that less than 10% of the global oil inventories surplus remains after OPEC and its partners curbed production by even more than they intended while world demand climbed. In addition, the Saudi’s indicated they would be happy for oil prices to rise to US$100.
Economics
- The Australian unemployment rate rose in March to 5.6%. Western Australian recorded the biggest jump. No upward pressure on wages with unemployment at this level.
- US consumer sentiment data slipped in April after recording its highest level since 2004 in the previous month. In particular, consumer attitudes on the economy fell below optimistic levels.
- In other US economic data, housing starts rebounded in March whilst industrial production came in above economists’ expectations.
- European trade data weakened in February whilst the Eurozone’s trade surplus widened. Exports of goods fell 2.3%, the 2nd straight month of decline, whilst imports fell by 3.1%.
- Chinese data showed March exports unexpectedly fell 2.7% from a year earlier whilst imports jumped more than forecast, which left the country with their first monthly trade deficit in over a year.
- China’s economy grew 6.8% in the 1st quarter of 2018, which was slightly above market expectations, but in line with the two previous quarters.
- In other Chinese economic data, retail sales accelerated coming in above expectations, whilst both industrial output and fixed asset investment came in below economists’ expectations. The “old” economy is slowing whilst the “new” economy is growing
- The Chinese central bank has cut a key ratio which means that banks can lend a little more freely.
Politics
- The US, UK, and France launched the biggest intervention yet by Western countries against Syrian President Al-Assad and his ally Russia. 105 missiles targeted chemical weapons facilities in Syria, in retaliation for the suspected poison gas attack earlier in the month.
- The United Nations Security Council rejected Russia’s call to condemn the US and its allies. Russia, China, and Bolivia voted in favour of the resolution. The US is now looking at further sanctions on Russia.
- Russian President Putin has warned that further Western attacks on Syria would bring chaos to world affairs, as the US prepared to increase pressure on Russia with new economic sanctions. The US moves are aimed at forcing Putin to focus his efforts more inwards on his own economy.
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