What to Watch - Week of 10 March 2025
Past Week
- German infrastructure and defence spending deal saw yields rise sharply in Europe and supported the euro. The tariffs on Canada and Mexico initially went ahead, though have since been paused for USMCA-compliant goods. US Equity markets fell sharply and the DXY is 3.3% lower.
- Australian Q4 GDP beat, but the details suggest little change in narrative. RBA speak and the RBA Minutes also did not add much. Markets are around 80% priced for a May rate cut.
Week ahead
- A quiet week in Australia with focus potential fallout from Cyclone Alfred which is set to hit QLD and Northern NSW (early Saturday morning). As for dataflow the major pieces are the NAB Business Survey and Westpac Consumer Sentiment (Tuesday). Note VIC, SA, ACT & Tas public holiday on Monday.
- Offshore, it is a very busy week with major risk events being:
- whether the US’ 25% tariffs on steel and aluminium go ahead in full, and if so any potential retaliation (Wednesday);
- US CPI and PPI to see any early tariff price impact either from front running or from the initial 10% tariff on China that took effect on February 4 (Wednesday and Thursday); and
- if a US government shutdown is avoided by Friday when a continuing resolution is due to be passed.
- In Canada the BoC meets (Thursday) with markets around 75% priced for a cut. Previous modelling by the BoC suggested moderate rate cuts could be supportive should tariffs be imposed.
- China’s two sessions (NPC & People’s Political Consultative Conference) wrap up on Tuesday, and early in the week are CPI/PPI figures (Sunday).
- Europe is busy with lots of talk around defence with Defence Ministers meeting (Monday) and the Paris Defence Forum (Tuesday to Thursday)
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Also in the What to Watch
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