Aus and NZ - economic data and event previews

Australia and New Zealand - economic data and event previews

Australia

Aust. PPI (%q/q, 1Q) - Producer prices at the final stage of production should fall 0.1%q/q in 1Q, mainly owing to lower import prices. Weaker domestic demand probably meant that firms continued to face difficulties in passing on still-high early-stage input costs to final prices, leaving profit margins squeezed.

RBA Board minutes (Apr.) - The minutes from the Board meeting two weeks ago should make interesting reading. On one level, it will be insightful to see how officials weighed up the various arguments that led to what we describe as a middle-of-the-road 25bp rate cut. There almost certainly will be discussion of the need to balance the need for lower market interest rates against the desire by RBA officials to preserve policy flexibility for later. On another level, the minutes may provide colour on the degree to which elevated bank funding costs played a role in the Board’s decision.

RBA Governor Glenn Stevens' speech - The Governor will be addressing the Australian Institute of Company Directors. He will be discussing the current economic climate - a Q&A session will follow. Coming just two hours after the release of the April Board minutes, the speech is unlikely to reveal much that is new.

Aust. CPI (%q/q, 1Q) - Headline inflation should fall back within the RBA’s 2-3% target range. From the previous quarter, the CPI should grow 0.2%q/q (consensus 0.5%). The mild pickup in consumer price growth in the March quarter will be owing mainly to elevated food prices. Prices in areas such as housing and automotive fuel would have continued to ease. The import price data released last week delivered an unexpectedly large drop over the quarter.

New Zealand

NZ credit card spending (%oya, Mar.) - Credit card spending should remain weak. Consumers are choosing to pay down debt and boost savings amid widespread recession fears and increased anxiety about job security.

Data Previews (pdf)

ENDS

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