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Weekly Economic Commentary

Weekly Economic Commentary

Categories: General, General

With a lack of any major economic data releases, the first of three US Presidential debates took a lot of the focus for markets last week, with a CNN poll indicating that Democrat Hillary Clinton was a clear winner (62% to Donald Trump’s 27%). Reaction was slightly “risk-on” as Trump is largely regarded as a market negative.

However, debate victories are not necessarily reflective of winners. In the 2012 Presidential race, only 20% of voters polled by Gallup believed President Barack Obama had won his first debate with Romney who got 72%. – as As for the subsequent victor, many now ask, Mit who? No doubt markets will be sensitive to the next two debates and the batch of polls that follow.

The data calendar picks up once again this week and we also have another monthly RBA board meeting to consider what to do with rates. The market is pricing almost no chance (less than 5% probability) of a rate cut this Tuesday, but the meeting will gain some added attention as it is the first meeting for Phillip Lowe as the new Governor.

Current implied cash rate pricing from interbank bill futures

Cash Rate Pricing

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Disclaimer: Whilst all care has been taken in compiling the information, the information should not be relied upon as substitute for professional advice where necessary. Rural Bank accepts no responsibility for the accuracy, completeness or timeliness of the information and disclaims all liability in relation to any loss or damage suffered by the use of or reliance upon any information contained herein or in any attachment or annexure hereto by any person. Rural Bank – A Division of Bendigo and Adelaide Bank Limited ABN 11 068 049 178 AFSL 237879