Wednesday 18th May 2022
Equity markets have rallied today, buoyed by positive retail numbers for the US. But NAB’s Rodrigo Catril says the sentiment really improved in APAC yesterday on news that Shanghai will reopen after three days of zero COVID infections. Markets turned when the Fed’s Jerome Powell spoke about pushing beyond neutral to curb inflation, but shares rebounded soon after. Britain’s job numbers would look fantastic at any other time but now – instead, lower unemployment and rising vacancies spells out further inflation risks which will encourage the BoE to move faster, perhaps. Even the cautious ECB has one member talking about a 50-basis point rate hike. Today Australia’s wage price index will be watched keenly because it could be influential in the RBA’s next move up in rates.