The Friday Market Wrap - 03 March
- Australian GDP grew 0.5% over Q4 2022, moderating from a 0.7% rise in Q3. GDP growth rate printed below expectations of 0.8% and has been the softest increase over the last five GDP prints as cost pressures and elevated interest rates dampen spending. The household savings ratio fell to 4.5% from the previous 7.1% and both public and private investments declined (yet still at a high level). External demand contributed to GDP growth as exports added 1.1% while imports retracted 4.3%.
- China Manufacturing PMI printed a boom of 51.6 in February from contractionary territory of 49.2 in January, smashing expectations of 50.2. The first increase in factory activity since July 2022 after a shift in covid zero policy. Both new orders and exports rose for the first time in seven months and backlogs of work increased at the quickest rate in 16 months.
- Australia’s monthly CPI indicator showed an increase of 7.4% in January, slowing from record highs of 8.4% in December. Upward pressures still coming from the cost of housing (9.8%) and food and beverages (8.2%). Inflation remains sticky and well above the target range of 2-3%.
- US ISM Manufacturing PMI edged higher to 47.7 but printed softer than expectations of 48. Falling factory activity over the past fourth months is observed to match falling demand. New orders and backlogs of orders also contracted with inventory levels decreasing.