ASX set for a soft start as trade jitters continue


A gradual drip-feed of positive trade war news continues to support stock indices. That’s maintained the risk on atmosphere in global markets. The rosy sentiment was backed-up by a speech by US Federal Reserve Chair Jerome Powell yesterday in which the Fed chair spoke up the prospects for the US economy.

Our own central bank head had his time in the limelight yesterday, too: RBA Governor Lowe delivered a speech discussing “unconventional” monetary policy. In other geopolitical news, the Pound dipped as the latest polling showed a narrowing lead by the UK Conservative Party. And in the day ahead now, interest turns to Australian economic data.

A series of Australian GDP partials will be released beginning with quarterly Construction Work Done data today. General weakness in the building and construction activity has been a headwind for the Australian economy in recent times with downside surprises in that data having been the norm.

The likelihood for an RBA cut next week is still rather slim, currently sitting at a modest 20 per cent chance. A miss in today’s release and those in the day ahead may see these odds boosted as forecasters downgrade what’s in store for GDP figures next week.


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