Weekly Market Recap
Week in review
- China’s PMI for manufacturing lower at 50.9
- Australia housing finance up 4.9% m/m in May
- Australia private sector credit 0.4% m/m
- Australia RBA rate setting meeting
- U.S. FOMC meeting minutes
- China CPI inflation
Thought of the week
Concerns of another wave of COVID cases knocked Asian markets last week as investors tried to assess the potential to damage the economic recovery. Studies conducted so far show that existing vaccines provide a degree of protection against virus variants, suggesting that fatalities and hospitalisation rates may be lower. However, it may also mean that a greater share of a country’s population may need to be vaccinated to achieve herd immunity, delaying the re-opening in some parts of the world. The more contagious delta variant amplifies the risk in countries where the vaccination roll-out has been slow due to limited vaccine supply or a hesitant population. Meanwhile, the Eurozone and the U.S. are enjoying the benefits of economic re-opening that come with higher vaccination rates and consumer confidence numbers continuing to move higher (see chart). COVID is still a risk, but the strength of consumption is a powerful force.
U.S. and Eurozone consumer confidence still rising
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