Westpac IQ

Monday re-issue edition: analysis and forecasts for this week's key releases.

Friday edition: analysis and forecasts for this week's key releases.

Entrenched expectations that cost increases can and should be passed on are precisely what tight monetary policy is leaning against, but only indirectly.

The energy industry faces a new challenge as the surge in household battery uptake gives consumers more control over when they store, use and export electricity.

The latest edition of Sustainability Impact explores proposed reforms to Australia’s modern slavery laws and potential changes to climate disclosure requirements. We also examine the rising economic risks facing Australia’s coastal communities, progress towards lower-emissions ironmaking in the Pilbara, innovative approaches to turning waste into fuel and more.

Affordability, price stability and resilience are the major procurement priorities our customers are telling us they’re considering when sourcing their next electricity contract, and there are many trade-offs to consider.

It started out calmly enough for the Australian dollar last week, comfortably trading on the 0.69-handle and even very briefly pushing above 0.70c just ahead of US Sep CPI. But a stronger print, followed by softer Australian labour data Thursday and AI volatility, upset the Australian dollar's calm demeanour sending it to 0.6894, its lowest level since July. The Australian dollar has since steadied and we start the new week trading back above 0.6950. On the calendar this week; RBA Deputy Gov. Hauser speaks (Wed), NZ Q3 CPI (Thu), we receive preliminary global Oct PMIs and US big tech earnings.

AUD/USD staged a recovery of sorts last week, rising towards 0.6980 by Friday's close. Improving market sentiment was driven by easing geopolitical concerns after President Trump ruled out an attack on Iran before the US midterm elections, alongside strong auction demand for longer-dated US Treasuries and supportive comments from ECB President Lagarde. The week ahead could prove pivotal. US Sep CPI is the key event, followed by comments from Fed Chair Warsh (Fri). RBA Minutes (Tue) and Australian labour market data (Thu) are secondary but still important.

The Australian dollar spent much of last week holding comfortably in the mid-0.71s before buckling under the weight of higher US yields and a softer labour market report. The Australian dollar faces a defining week. The spotlight is firmly on the RBA, with markets expecting a 25bp rate hike tomorrow ahead of Wednesday's CPI. Markets will be closely watching the Governor's press conference, voting split and any commentary around softer labour market conditions for clues on whether further rate hikes remain on the table.