Key US inflation numbers were in line with market expectations, slightly softer than the record peak in the previous month. The headline rate fell from 5.4% p.a., to 5.3%p.a., in line with expectations. US equities fell away, none the less, as the inflation rate remains historically very high and refutes the Fed’s ‘transitory nature’ claim. US Bond Yields drifted, as did the US Dollar. The EUR traded up to 1.1820, while the GBP held 1.3830, supported by steady employment numbers. This may change with key CPI data out tonight, considering the Bank of England has already warned of the dangers of rising inflation, as the economy re-opens.
Australian House prices continued to surge, rises hitting 6.2% for Q2, surging to 16.8% for the year! These massive increases are despite half the country suffering political lock-downs, aggravated by the RBA’s QE infinity and modern monetary policy. The RBA has been warning of the dangers of asset bubbles and this is a monster! The AUD slipped back to 0.7330, while the NZD clings desperately to 0.7100.
Markets await consumer confidence numbers from both Australia and NZ, while the Japanese Tankan report will be an early focus.