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Speaker 1: Welcome to Fear and Greed the Week Ahead. I'm Sean Elmer,

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Speaker 1: and as always I'm joined by economist Stephen Kokulis. You'll

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Speaker 1: pinetrem at the cook dot com, t h E k

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Speaker 1: o UK, the cook dot com and on X using

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Speaker 1: the handle the Kirk.

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Speaker 2: Stephen, Good morning, very good morning, Sean.

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Speaker 1: Before we get into this week, last week we had

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Speaker 1: the sort of end of the election, we had fights

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Speaker 1: over liberal leadership, Green's leadership. We also had some pretty

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Speaker 1: interesting economic data, you know, household spending, we had building approvals,

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Speaker 1: and of course what happened in the US with raids.

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Speaker 1: I mean, I'm going to ask you in about two

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Speaker 1: minutes to wrap all that up.

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Speaker 2: You're right, the local data, which was a little bit disappointing.

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Speaker 2: You know, the household spending survey was minus point three

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Speaker 2: change in the month of March. So again month and

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Speaker 2: month you tend not to get two carried away because

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Speaker 2: there's a bit of volatility. There's they were actually impacted

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Speaker 2: those numbers by the cyclone in northern New Wales and

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Speaker 2: southern Queensland, so there was a bit of a hunkering

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Speaker 2: down of people been locking their houses while the rain

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Speaker 2: was falling. So it distorted the numbers a little bit.

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Speaker 2: But the March quarter as a whole, which is calculated

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Speaker 2: in real volume terms, so it feeds nicely into the GDPs,

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Speaker 2: which comes out in a few weeks time, was dead flat.

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Speaker 2: So the consumers that were looking a little bit more

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Speaker 2: optimistic at the end of twenty twenty four have kicked

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Speaker 2: off the March quarter twenty twenty five with a bit

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Speaker 2: of a hoe hum and a really flat result. And

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Speaker 2: that dove tull into the building approvals numbers. And in

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Speaker 2: recent times I've been sort of pretty exuberant about the

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Speaker 2: trend increase in building approvals that's been underway in the

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Speaker 2: last twelve months or so. A last we had a

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Speaker 2: minus eight point eight percent, and yes, it was the

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Speaker 2: highly volatile apartments and townhouses component was the driver of

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Speaker 2: that weakness. So again, if you get a big approvals

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Speaker 2: of a high rised development, you can get a very

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Speaker 2: big percentage change in your monthly numbers. But it was

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Speaker 2: actually big enough fall to cause the trend to dip

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Speaker 2: back down. So oh, that supply side of housing just

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Speaker 2: wasn't there. And of course the good old fed no

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Speaker 2: surprise there, kept rates on hold. But jerme Powell, the

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Speaker 2: FED Chairperson's testimony and commentary and interviews and whatnot were

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Speaker 2: really interesting. He sort of gave a backhanded to Trump

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Speaker 2: when he was asked about having spoken to Donald Trump,

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Speaker 2: and he said, well, I've never spoken to any president.

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Speaker 2: I never asked for a meeting with any president. So

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Speaker 2: he said, look, we're worried about inflation being too high,

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Speaker 2: but we're also worried about the economy being too slow.

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Speaker 2: So that's your I won't say the word stagflation's naetic,

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Speaker 2: but that's the sort of issue that a few people

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Speaker 2: are talking about, you know, with Gusto in the US.

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Speaker 1: As we're head into this week, a big week for

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Speaker 1: the labor market because a couple of really important indicators

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Speaker 1: from the Reserve Bank point of view also.

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Speaker 2: Oh huge numbers in fact, because the RBA meets next

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Speaker 2: week on the twentieth is when they make their decision

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Speaker 2: on rates. Two thirty will preview that next week, of course,

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Speaker 2: but these are the last two important segments of whether

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Speaker 2: they will hold twenty five or the outside chance of fifty.

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Speaker 2: And even you know, the wonderful Sally old who's now

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Speaker 2: the new chief economist that NAB is calling for fifty,

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Speaker 2: which is a really interesting call, and her view is

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Speaker 2: premised on these numbers coming out week so in no

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Speaker 2: particular order. The wage price index number that is likely

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Speaker 2: to confirm about a point eight or a point nine

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Speaker 2: quarter on quarter increase in wages. That translates to a

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Speaker 2: manual rate around about three point three percent, So actually

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Speaker 2: in that goldilocks groove, just in the nice level of

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Speaker 2: wage increase, So any deviation above or below will obviously

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Speaker 2: feed into RBA deliberations. And the other one is the

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Speaker 2: labor force number. So you know, we've had a trend

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Speaker 2: slowing in employment growth. Unemployment's crept up a little bit,

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Speaker 2: but not much in the last little while. It's sort

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Speaker 2: of been stuck just at four or four point one percent.

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Speaker 2: Any sign of another weak employment result or a further

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Speaker 2: uptick in unemployment rate, and you know, Sally's call of

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Speaker 2: a fifty point move could just get a little bit

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Speaker 2: more chatter going on in the markets. But yeah, it's

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Speaker 2: all eyes on the labor force numbers.

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Speaker 1: Fantastic, do you reckon? The things will settle down now

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Speaker 1: that the election's over and we've sort of, you know,

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Speaker 1: we're running into a reserve. Being board maning so it's

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Speaker 1: never going to totally settle down, but it kind of

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Speaker 1: gives us a little bit of breathing space. We've also

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Speaker 1: had as seemingly tariff deals with the US and other countries.

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Speaker 1: It's kind of looking a bit better.

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Speaker 2: It's looking a bit more stable, and in a funny way,

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Speaker 2: the election. It's the element uncertainly about elections in a

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Speaker 2: way we know where we stand when election has been held.

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Speaker 2: I know it sounds like a really silly thing to say,

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Speaker 2: so for the moment, and I think permanently we can

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Speaker 2: put aside, you know, nuclear energy and a twenty five

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Speaker 2: cent eli cut in petrol tax, and if the Libs

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Speaker 2: had won the election, we could have put aside, you know,

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Speaker 2: some of Labour's policy agenders, but labor one in a

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Speaker 2: funny way, because it's the re election of an incumbent.

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Speaker 2: It's the devil we sort of know, yep, and Jim

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Speaker 2: Charmers has come out, you know, showing that he's going

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Speaker 2: to be pretty humble but then getting on with the

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Speaker 2: job of reform. So the proof will be in the porting.

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Speaker 2: So yeah, we'll be looking at how Labour can deliver

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Speaker 2: over the course of this term. But it's good to

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Speaker 2: get the X out of the way. And yeah, we're

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Speaker 2: still on Trump watch for sure, and we're still on

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Speaker 2: inflation and domestic data here in Australia watch too, just

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Speaker 2: to see whether we've got that momentum of you know,

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Speaker 2: decent growth or whether we're going to have that. I

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Speaker 2: call it a double dip, but just a prolonged period

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Speaker 2: where growth sort of neither here nor there.

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Speaker 1: Stephen and Joe the Week Thank you, Sean, it was

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Speaker 1: Economist Stephen coucoulis, better known as the Kook. You can

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Speaker 1: find him at the cook dot com and follow him

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Speaker 1: on X using the handle the Kirk on Seaneelmer and

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Speaker 1: this kiss Peering three.

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Speaker 2: The Week Ahead,