NAB Morning Call

Friday 11th April 2025Please note this communication is not a research report and has not been prepared by NAB Research analysts. Read the full disclaimer here.Economists these days tend not to treat the supply of money as a major determinant of economic growth. That’s because a downturn in the supply of money can be counteracted by the speed at which money changes hands. This week Steve Hanke, a Professor of Applied Economics at Johns Hopkins University in Baltimore, argues against that belief. The velocity of money is relatively constant, he says, but the supply of money is the major determinant of economic output, driven primarily by loans from commercial banks. Listen to his reasoning on this week’s podcast and why he thinks the RBA is doing a good job for Australia, but the US could be heading for a recession, even before Trump’s tariff adventure. Hosted on Acast. See acast.com/privacy for more information.

Gavin Friend, an expert from NAB, dives into the turbulent world of global markets. He discusses the fleeting recovery of U.S. equities amid ongoing U.S.-China trade tensions. Listener's will find intriguing insights on Australia’s economic resilience and the potential for aggressive rate cuts by the RBA. Friend also sheds light on the implications of fluctuating oil prices and consumer trends impacting the Federal Reserve’s approach to inflation. Tune in for a reality check on the shifting dynamics of the financial landscape!

Thursday 10th April 2025NAB Markets Research Disclaimer Financial Services Guide | Information on our services - NABA roller coaster session on the markets. It started yesterday during the day in Australia with massive selloffs in US bonds on the news of rising tariffs from China and the US. The US is now up to 125%, with China imposing 84% from tomorrow. NAB’s Ken Crompton says if there was a Laffer Curve for tariffs we are well beyond the point where revenue keeps rising. But late in the session President Trump announced a 90-day delay on some of the heftier tariffs – China excepted. Elsewhere a 10% tariff will apply, and world leaders have three months to negotiate. That’s resulted in a record turnaround in US equity markets, although bond markets are a little less convinced.  Hosted on Acast. See acast.com/privacy for more information.

Wednesday 9th April 2025NAB Markets Research Disclaimer Financial Services Guide | Information on our services - NABThe full set of US tariffs applies from midnight tonight in the US (2pm Sydney and Melbourne). Including the hefty ones with China. As NAB’s Sally Auld says, the China tariff is so high its basically an acknowledgement that they don’t want to trade with China anymore, unless a deal is done. There has been more talk of potential deals. If any of them come to pass it will be an indication that the Trump administration is willing to negotiate, rather than slavishly sticking to a principal of completely balancing trade with each country. Who knows? Certainly, the optimism in the markets early on in the session quickly diminished and stock markets closed well down in the US. Hosted on Acast. See acast.com/privacy for more information.

Tuesday 8th April 2025NAB Markets Research Disclaimer Financial Services Guide | Information on our services - NABMarkets were momentarily excited earlier when it seemed that the President might be delaying tariffs for 90 days. Up to that point US equities were continuing to spiral lower, but newfound optimism that Trump might moderate his approach saw a swift reversal. When it emerged that the story was nothing but fake news and, if anything, the President was digging his heals in harder, markets didn’t immediately return to their session lows. NAB’s Tapas Strickland says part of that could be because more CEOs are speaking out against the tariffs and that could force the plans to be rolled back. But, Phil asks, does that mean market have further to go if it becomes clear that the tariffs will stick, and go beyond a temporary negotiating tool. Hosted on Acast. See acast.com/privacy for more information.

Monday 7th April 2025NAB Markets Research Disclaimer Financial Services Guide | Information on our services - NABIn a world gone a little bit crazy, the only question is, how much crazier can it get? China has been the first to hit back at the US with retaliatory tariffs applied from April 10th. EU trade ministers are meeting today to discuss the next steps. If compromises aren’t found, what happens next? NAB’s Rodrig Catril says they are not forecasting a US recession just yet, although some are – like JP Morgan, for example. Jerome Powell was reasonably circumspect on Friday, saying the higher tariffs could prolong inflation w which could delay the Fed’s response to an economic downturn. Ironically, non-farm payrolls showed a US economy strengthening, but it seems the President is prepared to jeopardise short term economic stability in exchange for a significant change in the pattern of international trade. If that’s’ the case, negotiated deals this week seem unlikely. Hosted on Acast. See acast.com/privacy for more information.

Friday 4th April 2025Please note this communication is not a research report and has not been prepared by NAB Research analysts. Read the full disclaimer here.This week TCorp, the NSW Treasury Corporation, put out a report on the evolving financial landscape. They certainly picked an interesting week to launch it. Phil talks to TCorp’s chief economist Brian Redican about how Trump’s approach to trade has created uncertainty and how Australia, like other nations, will be looking for trade partners with the same attitude to free trade. And how, with less trade exposure to the US than the likes of Europe and Canada, and a rich seam of rare earth minerals, could this new trade environment could be beneficial for Australia? Hosted on Acast. See acast.com/privacy for more information.

Friday 4th April 2025NAB Markets Research Disclaimer Financial Services Guide | Information on our services - NABYou’ll know by now that President Trump’s tariff regime was worse than many had expected, even though Australia got off relatively lightly. You might also be aware that, despite the Presidential claims, the numbers were not based on the tariffs charged by supplier nations, but on a relatively crude formula based on the value of exports to the US against the US balance of trade deficit with that country. That makes it rather problematic for countries to fix-lowering tariffs that might not exist in the first place. But could all this be good for Australia. Phil asks NAB’s Ken Crompton, might we be one part of the world where inflation is contained, and interest rates continue their expected downward trajectory? They also talk about non-farm payrolls, because that’s happening today as well. Hosted on Acast. See acast.com/privacy for more information.

Thursday 3rd April 2025NAB Markets Research Disclaimer Financial Services Guide | Information on our services - NABPresident Trump’s announcement in the Rose Garden is bad news for us. For the podcast, that is. It’s just after we publish the final edition at the US market close. So, there’s every chance you’ll know what’s happened before you listen. But what happens next? And, as NAB’s Rodrigo Catril points out, there’s more to come from President Trump, plus any retaliatory moves by other nations. Rodrigo and Phil talk about how the markets reacted in the build up to the US close. Larry Summers says the real unknown is how much damage it will do to the US economy and the difficult position it places the Fed in. Hosted on Acast. See acast.com/privacy for more information.

Wednesday 2nd April 2025NAB Markets Research Disclaimer Financial Services Guide | Information on our services - NABMarkets continue to dance around the uncertainty of Donld Trump’s Liberation Day tariffs tomorrow. There was a suggestion in the Wall Street Journal that the President might impose a 20%traiff on all imports, from everywhere, with the White House Press Secretary saying it was her understanding that the tariffs would be applied immediately. The truth is, nobody knows until Donald Trump says it, and even t hen it could change.Data wise we saw a slightly weaker than expected ISM Manufacturing number overnight, with a surprisingly high prices paid component. The JOLTS job openings data also came in weaker than expected. NAB’s Taylor Nugent talks through the numbers, as well as reviewing the RBA decision, statement and press conference yesterday. Eurozone inflation also came down a little.Today, tariffs aside, we get Australian building approvals, and the ADP payrolls numbers for the US, ahead of non-farm payrolls at the end of the week. Hosted on Acast. See acast.com/privacy for more information.