US equity markets surged overnight, boosted by corporate earnings, lead by the banks. The global banking institutions love the inflationary economy, as it provides a upward scale in interest rates and an opportunity to make margin. The US PPI number was in line with market expectations, a high at 8.6%, but inflationary as was the CPI inflation number (5.4%). Contained inflation allowed markets to rely on monetary stimulus, as the Fed takes every opportunity to leave rates at record historical lows. The European Council will meet tonight and this may cause market influence, but the EUR bounced towards 1.1600, while the GBP looked to regain 1.3700.
Australian Employment data was better than expected, the headline rate rising to 4.6%, which was incredible, considering the lock-downs across the most populus States of NSW and Victoria. These numbers must be looked at as a trend line, because the accuracy compilation is ‘Wonderland’ levels. Market will focus on growth and inflation, with Australian inflation data set to be released today.