Shane Solly: Harbour Asset Management spokesperson on what the US CPI report means for rates

The next US Consumer Price Inflation report will be out this week, and economists are speculating about what this could mean going forward.

Markets are keeping an eye on things, as inflation continues to be an issue in the US.

Harbour Asset Management's Shane Solly explains further.

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Episode Transcript

Speaker 1 (00:00):
Ever duper c L.

Speaker 2 (00:01):
I'm going to get to your Feedback's a lot of it.
We're going to get to your feedback shortly, and also
explain this idea of the generation being stripped out of
the gen tailors right now, six twenty one, Shane Solly,
Harbor Asset Management is with us as Shane. Hello, Heaver, Right,
what are we thinking about the feeds chances of cutting
the rates?

Speaker 1 (00:17):
Well, it's a big one. I'm going to be honest
with you. The We've got July consumer price inflation for
the United States that comes out on Tuesday night in
news on time. They'll influence whether the US FED that's
a central bank, and the US does cut rates when
they do it how often. Obviously, mister Trump, the President
is pushing in the cut rates. But inflation has been
pretty sticky. Market is expecting about a zero point two

(00:38):
percent number for the July month. That conmits to two
point eight percent for the full year. Maybe getting enough,
maybe getting enough, But you know, the feed's been pretty
sticky with this sort of four point twenty five four
point five percent range they're put in December. Look, I
think the markets can be a bit weary. Uh, Market's
gonna be worried if it comes in hot. Either, to
be honest with that, it's above that point two, then

(01:00):
the market's gonna be worried about interstrates staying high when
the economy is slowing down. So yeah, really important one
on Tuesday night in New Zealan time.

Speaker 2 (01:07):
Now, what is the market expecting from the RBA tomorrow?

Speaker 1 (01:10):
Yeah, in contrast fully pricing and aero point twenty five
percent cut from THEBA taking their official case rate down
to three point six percent last month. Of course, either
they shocked us by not cutting. They said we want
to see some more data, particularly on price growth and inflation.
Since then, we've had inflation come in lower than expected
two points in percent and actually unemployment starting to rise,

(01:31):
and iussy something that many New Zealanders don't realize that
economy is actually starting to slow down. So a cut
that would be pretty helpful and just cushioning the bit
of slow down that's occurring, boosting household confidence which is
actually pretty weak. If they don't cut, markets will be weak. Yeah.

Speaker 2 (01:46):
Did you see that stuff around spark selling a steak
in the data center business? How the market react to that?

Speaker 1 (01:51):
Ah? Yeah, Look, so we've seen Australian Financial Review report
and the weekends Pacific Equing Partners is closing in on
taking stay Can Sparks five hundred and fifty million dollar
plus status in the platform, sparking out this morning and said, no,
nothing is a year. The processes on going. We'll tell
you when we're ready to tell you when something's going on.
But look, the Thin Review report was pretty specific. They

(02:15):
talked about controlling stakes. They took about a new zion
dollar six hundred million dollar valuation, so quite specific. Actually
on the day the sheeprice pretty flat only up points
six two sixty one. Sorry either, really bit of a
balance between we're watching for a bit of a possibly
a flat result, poor result coming up in their result
in a few weeks time versus this deal.

Speaker 2 (02:38):
And also the IPO for Fontira's offer, isn't.

Speaker 1 (02:41):
It well yeah, look again the Financial Review is amazing
how this IY paper things to step up as saying
that French multinational company like Talastan brands like Pools and
Oak in Australia, they're the lead better for Fonterra's consumer
products business. Apparently they're being given exclusive opportunity to buy it.

(03:02):
This has been a prolonged process, Frontier started back and
Frontier a sorry and back in November saying hey, we're
indicating a trade sale or io. It's looking like a
trade sale. The keeping is for New Zealand Incorporated. If
there is a good price, then that money could find
its way back to justice and farmers in the form
of a returning capital. Share price was actually up almost

(03:24):
two percent to seven dollars eighteen today.

Speaker 2 (03:27):
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