Strong data out of Australia, Luxon’s faux pas

There are tentative signs that the Australian economy may be starting to heat up. We learnt that underlying inflation accelerated anew in July, while a new ABS survey showed that firms are becoming more bullish about their capital spending plans. All told, there is a growing risk that the RBA won't cut rates quite as far as we're anticipating. Elsewhere, New Zealand Prime Minister Luxon sparked controversy when he admitted to advocating for the RBNZ to loosen policy more aggressively. Despite the poor optics, we do not expect his government to undermine the Bank's independence.