Westpac has shifted its expectations regarding the Reserve Bank of Australia's (RBA) monetary policy, now anticipating a rate cut in February rather than May. This adjustment aligns with the recent data showing a softer core inflation reading in Australia, prompting analysts to reconsider economic strategies. Meanwhile, traders remain cautious ahead of the Federal Open Market Committee (FOMC) policy decision, which adds to the current market uncertainty.
In the corporate sector, Apple is reportedly collaborating with SpaceX and T-Mobile to enhance service capabilities on iPhones. This partnership aims to enable iPhones to connect with Starlink satellites, with an update expected soon to support this new feature. The collaboration signifies a significant step towards enhancing connectivity and bridging communication gaps globally.
Across the Tasman Sea, the Reserve Bank of New Zealand (RBNZ) purchased a net NZ$177 million in December. RBNZ's Chief Economist, Conway, has stated that the long-term nominal neutral interest rate hovers between 2.5% and 3.5%. Moreover, Finance Minister Willis emphasized that while they aim for growth, it cannot be taken for granted, reflecting a cautious economic outlook.
OpenAI is actively working to protect its intellectual property from Chinese companies attempting to replicate US AI models. This move highlights the increasing importance of safeguarding technological advancements amidst growing international competition in artificial intelligence.
Corporate earnings continue to hold the spotlight, with significant announcements expected from companies like SMFG, Shin-Etsu Chemical, CyberAgent, Makita, and Advantest. These earnings reports are anticipated to provide insights into how different sectors are navigating the current economic landscape.
In Australia, bond yields have declined following the release of Consumer Price Index (CPI) data. The Australian Dollar (AUD) experienced a 0.4% drop against the US Dollar (USD), influenced by the latest inflation figures. The Australian December CPI year-on-year was recorded at 2.5%, aligning with market expectations, while the CPI Trimmed Mean year-on-year was 2.7%, down from a previous 3.2%. This has led to a modest recovery in risk sentiment and a reduced demand for USD as a safe haven.
In contrast, stock markets have shown varied responses. The Nikkei 225 index rose by 0.8%, and Australia's ASX 200 increased by 0.6%. However, the Shanghai Composite and Kospi indices remained closed due to holidays, providing a temporary pause in trading activities in those regions.
Sony Corporation also made headlines with its announcement regarding leadership changes. Group President Totoki is set to take over as CEO on April 1st, while current CEO Yoshida will transition to the role of Chairman. This leadership shift aims to drive Sony's future growth and strategic direction.
On a different note, the US White House Press Secretary addressed concerns about potential national security implications related to DeepSeek. This highlights the ongoing scrutiny of technological developments and their impact on national security.