REITs may shine and lead gains in the SGX Hence, the Kiwi dollar could be further boosted by the RBNZ’s hawkish stance if this happens in its policy meeting this month. It vows to tame inflation even if the aggressive monetary policy may lead to an economic downturn. Unlike the RBA, the RBNZ will most likely concentrate on inflation rather than the economic outlook. While the New Zealand business confidence slightly bounced to -52 from a record low of -70.2 in January, the inflation data for the fourth quarter stayed at a 30-year high of 7.2%. The surge in the New Zealand dollar lost some steam in January as markets seem to be suspicious about whether the Reserve Bank of New Zealand (RBNZ) will remain hawkish in its rate hikes after the country’s unemployment rate is seen to rise to 3.4% from 3.3%, which is the highest since the third quarter in 2022. The RBNZ policy meeting may further boost the New Zealand dollar Plus, the upcoming major banks’ and miners’ half-year results may offer further strength to the Australian equity markets. In February, the RBA’s rate decision will be in the spotlight as the Reserve Bank is most likely to stay dovish as the economic growth becomes more of a risk rather than the hefty inflation. However, the country’s economic outlook gets gloomier amid sticky inflation, downbeat in its retail sales and loosened labour markets. China’s reopening has played a key role in boosting the Australian markets by improving the resource demand outlooks, typically in iron ore and copper, where the Pilbara Miners jumped 25%, Rio Tino rose 8.5%, and BHP up 7.4% in the first month of the year. The Australian markets remained robust in January, with the ASX 200 up 6%, buoyed by the strong performance of the miner stocks amid record output numbers and positive guidance. Australian stocks may remain robust, with the RBA rate decision and upcoming earnings in focus Shall a further cool in the consumer price, the Fed may further scale back rate hikes and possibly pause the cycle after March, which could buoy the risk assets further before its next meeting in March. In February, the US CPI data will be a focus to provide clues on the inflation trajectory. The good news is that the Fed further slowed down its rate hike pace to 25 basis points and indicated to cap the terminal interest rate under 5%, which is seen as a slightly dovish shift in its monetary policy. The ongoing tech earnings optimism also continued to fuel the rebounding euphoria. The growth stocks outperformed as the US inflation cooled for a third consecutive month, sending the tech-heavy index, Nasdaq, up 10% monthly. Wall Street had a strong month in January, with the S&P 500 up 7.9%, posting the best month since October 2015. The Fed may have booked a new-month rally on Wall Street, but keep caution on the inflation trajectory
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