28 Mar 2024
Australian inflation remains steady
Markets
- Local and global equity pushed mostly higher this week led by the US equity market which reached record highs.
- In local stock news, Fisher & Paykel Healthcare shares rose to a nine-month high after the respiratory care company upgraded its net profit expectations for the 12 months to March 31, due to a continuation of solid demand from hospital consumables.
- Retailer Premier Investments’ shares rose to more than a two-year high after the company said it would hike its dividend by more than 16% after a strong first half. The company also announced it would spin off its Smiggle brand by the end of January 2025 and explore a demerger of Peter Alexander.
- Boral bidder Seven Group hit back at an independent expert report claiming the takeover price undervalued Boral. The report suggested a price above $6.50 a share versus the $6.05 being offered by Seven Group to mop up the 27% of Boral they don’t already own.
- Cocoa prices are now more expensive than copper, with cocoa extending its surge surpassing US$9,000 a tonne for the first time ever as a supply crunch in West Africa impacts the market.
- Japan and China both moved to bolster their currencies with officials signalling support for their currency as both languish at very low levels.
Economics
- Australian consumer confidence continued to remain weak with a survey showing sentiment declined 1.8% in March to remain in pessimistic territory.
- The Australian monthly inflation indicator showed prices remained steady in February. The 3.4% reading was slightly below expectations of 3.5%. Housing costs continue to drive inflation outcome, with rents and new dwelling costs rising briskly, whilst underlying inflation fell to 3.9%.
- US home sales fell by 0.3% in February to a 662,000 annualised rate, below expectations.
- In other US data, a key manufacturing index fell further into contractionary territory against expectations of a slight improvement whilst a national activity index rose slightly in February.
- German consumer confidence rose slightly in March but remains in negative territory.
Politics
- All of India’s refiners are now refusing to take Russian crude carried specific tankers due to US sanctions. A stark contrast to the last couple of years where the two countries oil trading flourished.
- The bill to reform the Reserve Bank of Australia remains stuck in parliament with the opposition insisting the government retain its right to override policy decisions in the event of a serious dispute.
- Chinese Premier Li Qiang downplayed investor concerns of challenges facing the economy, saying Beijing is stepping up policy support to spur growth and systemic risks are being addressed.
- The Australian federal government has watered down planned vehicle emission standards. The new standards take effect next January.
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