Less jobs, more uncertainty
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Why is the Australian economy growing slower than expected and what does it mean for the RBA?
The Australian economy is growing slower than expected. Too slow, or just as the RBA wants it? We'll look at where we go to from here. Meanwhile, there are concerns that perhaps the Fed has overcooked things and jobs could fall quickly. A big drop in job openings overnight and the lowest for several years, and shares still falling. How much of it is AI fears? How much of it is growth fears more generally? And how much of it is just a bit of a readjustment will get Sally Old's take on all All of that today. It's Thursday, it's the fifth of September 2024. It's the morning call from Nab. Good morning. Well another bad session for US equities. They started in the red, they managed to climb into the green for the most part, but then they turned south towards the end with all indices uh in the red up to the close.
But the Dow managed to climb just a little bit, just naught point one percent into the green, but a naught point two percent drop in the S P and a naught point three percent fall in the Nasdaq, naught point two percent off the Russell two thousand as well at the close. Bigger falls in Europe with the Eurostocks fifty down one point three percent. JAX down 0.8%. The NICE yesterday down four percent. But as shares fall, bonds are rallying, pushing yields down. So seven basis points lower for 10-year treasuries, down to 3.76% now. Down five basis points for 10-year yields in Germany as well, down six in the UK, seven in France. Aussie 10-year yields were down five basis points yesterday to 3.95%. Now on futures, four basis points.
Points lower than that this morning. And the US dollar is heading back down again, half percent lower on the DXY.
How are US equity markets and bond yields reacting to the latest jobs data?
That's not really helped the Aussie too much. It's up less than 0.2%, uh, still above uh just above sixty-seven point two US cents. The gain has been though in the yen, it's up one point one percent, the Swiss franc is up 0.4%, the euro is up 0.3% as well, and oil lower again. WTI has drifted below sixty-nine a barrel with a A 2.1% fall overnight. Brent down 1.9%, uh just below 7240, the lowest level uh for the last 12 months. Actually, I think it's the lowest level since 2021, if I've got that right. So this is not just Libya, surely. So to make sense of what's going on here, JB Wears Sally All joins me. So the nervousness over jobs continues, Sally, and uh because there's less of them, I guess. So is uh some of the
reaction we're seeing today or is is most of it because that of that Joltz number overnight which showed quite a fall, didn't it?
Yeah, that's right. So the the Jolts numbers look at job openings, um so some basically look at uh hirings and and firings as well. And so I guess, you know, we're at this situation where the market's vacillating between a twenty five basis point cut from the Fed at its next meeting or a fifty and it sees the labour market data as as pretty critical in in uh influencing uh the Fed's ultimate decision. around the magnitude of the rate cut. So, you know, we're sitting here waiting for the payrolls numbers at the end of the week and so anything in between that might add some sort of sense of colour to where the labour market is at, I think is is pretty eagerly awaited. And so job openings fell to their lowest level since twenty twenty one.
Um, you know, very much keeps the focus on the labour market um ahead of the F O M C and it's consistent with this idea, as Powell articulated at Jackson Hole, that the labour market is slowing. Um the Fed is starting to worry more about that relative to inflation. Um And you know, particularly things like the ratio of job openings to the number of unemployed people out there, which is often a just a really good broad measure of tightness or otherwise in the labour market that is now below its pre COVID level. Aaron Powell But I mean it could also it could also mean people are
I mean, I guess it all amounts to the same thing. It could pe mean people are, you know, m moving jobs less, of course.
What does the JOLTS report reveal about US job openings and Fed rate‑cut expectations?
It doesn't necessarily translate to higher unemployment, does it? Well
not necessarily.
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Chapters
8 chapters
1
Why is the Australian economy growing slower than expected and what does it mean for the RBA?
0:01–1:30
2
How are US equity markets and bond yields reacting to the latest jobs data?
1:30–3:41
3
What does the JOLTS report reveal about US job openings and Fed rate‑cut expectations?
3:41–5:47
4
How is Sally Auld interpreting the labour‑market weakness and its impact on Fed policy?
5:47–7:52
5
Are AI fears or job‑market concerns driving the recent equity market sell‑off?
7:52–9:35
6
What does the Bank of Canada’s third rate cut signal for North‑American monetary policy?
9:35–12:19
7
What key points will RBA Governor Michelle Bullock address in her “Costs of High Inflation” speech?
12:19–14:57
8
Which upcoming data releases—US payrolls, ADP, and Australian trade balance—will shape market direction this week?
14:57–16:38