Risk off mood as virus cases rise, Lowe’s dovishness hits bond yields

Friday 16th October 2020There’s a strong risk off mood in the air, which has pushed the US dollar higher and hit stocks. Phil Dobbie asks NAB’s Gavin Friend whether markets are now accepting that COVID-19 cases are rising and that will stall attempts at an economic recovery. It certainly seems to be the case in Europe, with more stringent controls being introduced in Paris and London and cases rising in Germany too. Weekly jobless numbers pointed to a further slowdown in the US. At home, a very dovish Philip Lowe signalled where the RBA is heading in November – lower rates and more bond buying seems likely. NZ goes to the polls at the weekend, but it’s unlikely Jacinda Ardern has called the removalists.

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