US markets recovered some lost ground overnight, despite confirmation of rising inflation, in the form of a sharp rise in the latest PPI reading. PPI jumped 1.3%, for September and 6.5% annually, reinforcing yesterday’s hot reading in the CPI. Despite this, bond yields eased and the US Dollar was weaker, with the EUR regaining 1.1200, while the GBP surged to 1.3250. US Retail Sales were strong, but energy pressures will take their toll, as oil prices surge towards US$100/barrel.The softer reserve allowed the NZD to regain 0.5600, but the AUD ‘fell out of bed’, following troubling employment data. The Australian economy lost over 39,000 jobs in September, with the headline rate jumping to 4.7%, putting the RBA ‘between a rock and a hard place’. The RBA have telegraphed further rate rises to combat rising inflation, but the higher interest rates, are taking the toll on the economy and this is reflected in growing unemployment.
