Australasia

The Reserve Bank of Australia (RBA) has caused a surprise with a majority vote deferring the next official cash rate cut until additional data are received. Australian yields took another step higher based on this unexpected decision as the markets continue to assess the implications of the RBA’s deferral.

The Reserve Bank of New Zealand also left the official cash rate on hold at 3.25% at its July policy review, signalling that it will probably reduce the rate in August if the data and other developments over the next six weeks meet expectations.

Metal merchants have experienced some real challenges recently in shipping to some traditional overseas markets. This is mainly due to shipping lines seemingly changing the rules overnight, causing disruption and confusion. While the situation appears to have stabilised, uncertainty and interpretation are increasing the risk profile to some markets.

Domestic consumers are buying at current levels although some are signalling a slowing of demand. At the same time, some are being vocal about the challenges of higher energy prices and other increased compliance costs.