Australian GDP Satisfactory
The Australian dollar continued its recovery overnight, briefly peeping above 1.03. Yesterday’s lack of action from the RBA helped steady nerves, as did the overnight Australian Q4 GDP which fractionally beat consensus expectations. Stronger US stocks also had a role to play, with Dow Jones Industrial Average closing at a record high and the S&P500 not far behind. The news was not universally supportive however. Our Australia economics team note that, at 3.1% y/y, growth has come in below the RBA’s 3.5% y/y forecast. However they see this as being near-enough to trend to keep the RBA on hold going forward, especially in light of the better global outlook and firmer domestic data so far this year. The focus today will be on the Bank of Canada’s policy statement – specifically the possibility of a shift to a neutral stance. Bank of England Governor King is also due to testify before a parliamentary committee on regulatory matters.
Click here to read the full report: UBS Morning Adviser
UBS Investment Bank