Five central banks in the last gasp before Christmas
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What is the overall outlook for the Fed and the four other central banks this week?
The Fed and four other central banks this week in the last gas before Christmas. We can probably guess what each of them is gonna do. But what comes next? How many are gonna be pausing this week? How many are gonna do it next time as they feel their way to the neutral rate? Also, disappointing data from China on Friday, and we can assume that PMIs in Europe aren't gonna look too good today either. And France, a new Prime Minister, and a downgraded credit rating. Apart from that, everything is going really well for them. It's Monday, it's the six Sixteenth of December twenty twenty four, it's the morning call from Nab. Good morning. Big moves up in uh treasury yields last week. Uh ten years were up twenty-four basis points over the week, uh seven of those on Friday.
Aussie ten years are up twelve over the week, uh eight of those on Friday, and the US dollar rose further up naught point nine percent across the week on the DXY, with again over the week the yen down two point four percent, the Swiss franc losing one point six percent, one percent off the pound, less than half a percent off the Aussie dollar, though. A bad week for most US. Particularly mid caps, with the Russell two thousand down two point six percent, the DAX was down one point eight percent, the ASX two hundred also down a lot, losing one point five percent last week. But tech in the US did okay, so the NASDAQ was up naught point three percent over the week. And on the commodities front, well, WTI was up six percent last week, Brent up four and three quarters of one per cent.
And it is the last week of the morning call for the year, but Uh there's a lot still happening. So we've got the Fed, the Bank of England, the Bank of Japan, Norge Bank, RICS Bank, quite a lot of data as well. Uh here's Nabs Ray Atrill in Sydney. Let's start with the data from Friday Festival, Ray. So China's bank loan data showing uh loan growth has slowed. So for all of this stimulus effort, a lot of it focused on banks, trying to get banks to lend more, it's clearly not working.
Yeah,
I'm already fell.
Certainly the message from the numbers, isn't it? Well certainly as far as the sort of narrow measure of um new loans uh initiated by the banks, um if you look at the broader aggregate financing numbers, which includes things like effectively government bond issuance as well as corporate bond issuance. Um you know the numbers sort of held up reasonably well, but um new loan growth, what, five hundred and eighty billion uh Ramnimbi in the month? It was expected to be close. To um closer to a trillion. So um very much below expectations and to your point really says that um to date, really, um you know monetary policy easing actions uh are you know pushing on a string as far as uh initiating any enthusiasm from um you know the household sector or the corporate sector to be um borrowing money directly from the banks at least anyway, even though obviously there was some relief for homeowners from
That sort of across the board mortgage rate cap, which we had a couple of months ago. But um it really says that uh you know, despite the commitments, the commitments that we've that we've had verbally, at least from the um from the government about um you know moving to an accommodative monetary policy stance and initiating fiscal policy uh measures um or new fiscal policy measures, it's really the latter that I think, and ultimately I suspect sort of monetary finance. balancing of of fiscal expenditure is going to be uh what may actually help to right the the economy um and will be the appropriate response, assuming that um new tariffs are coming down the pipe uh fairly early in the uh the tenure of the uh of President Trump.
Why did Treasury yields jump sharply last week and what does it mean for markets?
Really?
Well we'll know, won't we? Very soon. Very soon indeed. Uh Japan, the tank and business survey on Friday as well, which is the last bit of data really ahead of the Bank of Japan on Thursday. So uh Ueda's not gonna make a move this week or is he? And and does this uh do these numbers change any of that? Well the numbers of
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