Big Week Ahead

On Friday last week, Australia RBA Credit (Sep) rose 0.1%, which was significantly below the forecast of 0.3% and is a very weak result considering the relative strength of the local sector. Business credit was equally as bad, down 0.9% after a fall in August of 0.7%. House prices were slightly higher, with a 0.2% jump in September, after a fall of 0.2% in August.

Overseas markets on Friday saw US GDP rise by an annual rate of 2% for Q3, which was in line with expectations after a rise of 1.7% (annualised) in Q2. European CPI for October was up 1.9%, slightly higher than the forecasted 1.8%, and EC Unemployment for October was 10.1%, the same as September and as expected.

A big week in the markets ahead with the RBA set to announce the rates decision on Tuesday, with the markets currently predicting a 22% chance of a hike. Other news this week in Australia will see Retail Trade, Building Approvals, Trade Balance and the RBA’s Statement on Monetary policy to be released on Friday.

In Offshore news this week, the markets will be closely watching the announcement of the US Federal Reserve, with the expectation that they will reveal a substantial easing in monetary policy with more extensive Quantitative Easing. US Non-farm Payrolls for October are also to be released with unemployment expected to come in unchanged at 9.6%. Also this week, central banks in the UK, Eurozone, Japan and India are meeting.