Let the trade games begin. I can’t believe that in 2019 we are having a “tit-for-tat” trade war between the two largest global economies. While the US-China negotiations are the most high-profile, US-EU trade negotiations are also at risk of escalating. A significant confidence shock coupled with a trade slowdown could lead to some pretty soft global economic global growth projections so, does anyone win?
We’ve now had two and a half years of around 30,000 average monthly employment growth which extended to April last week and that’s the key message the RBA will take from the data, despite the rise in the unemployment rate. So, despite higher unemployment, there is no pressure on the RBA to immediately cut rates and most are still pencilling in a rate cut in August at the moment.
We all now know that the Liberal-National party has been returned to government against most opinion polls after a strong campaign with a mix of factors leading to the result. Feedback shows the Opposition Leader was not seen as the preferred PM, the electorate did not liking the Opposition’s policies on changes to franking credits, negative gearing and capital gains tax, there was a big swing to the Coalition in Queensland where locals resented interference over the proposed Adani coal mine and a few supportive preference deals. The AUD is higher this morning and the share market is expected to also open higher.