Daily Commentary BY THE CURVE TEAM –

Crucial Week of Data Arrives

2nd of December, 2019

Markets prepare for a big week of data, with the RBA and GDP updates on the calendar.

Summer is underway and begins with a flurry of crucial data out this week. With recent soft data slightly contradicting the RBA’s ‘gentle turning point’ rhetoric, this week could prove as a tipping point for the outlook with risk for both the up and downside.

GDP partials for inventories will be out this morning. The market is expecting to see little change with another negative reading at -0.2% for Q3. We will also see company profits data today with a softening expected. These will lead directly into Wednesday’s offical numbers with expectations for a 0.5% quarter and 1.7% yearly reading.

Prior to Wednesday’s GDP data we will hear once again from the RBA. With the board set to meet Tuesday there is little expectations of a change to the cash rate with the market pricing a minimal chance of a cut. However, it will be interesting to see how market interest rate futures pricing evolves should the RBA leave the cash rate at 0.75% then GDP print with a softer than expected level. That could lead to expectations for a cut being moved forward from their current standing in May.

Later in the week we will likely see another near record trade surplus. Whilst there is a good chance the reading may be slightly lower than recent record levels a very large surplus is the market’s consensus.

Matthew Dunshea

Client Relationship Manager