InvestNow News – 29th May – ANZ Investments – The Month Ahead – June 2020
Global equity markets stabilised in May, albeit with periods of volatility, as the fallout from the COVID-19 (coronavirus) pandemic – both economic and societal – became a little clearer. The declining number of cases, or ‘flattening of the curve’, in Europe and the US provided some optimism, which saw a number of equity markets make modest gains through the first few weeks of May.
As we head into June, we will be paying close attention to the global employment situation as the number of people out of work begins to add to the strain on the global economy. Furthermore, heightening geopolitical tensions and growth data are some of the key areas on the radar this month. With this in mind, here’s ANZ Investments Month Ahead for June.
WILL THE US UNEMPLOYMENT RATE TOP 20%?
After a dire employment report for April, where the US economy lost more than 20 million jobs, May’s report is expected to show further job declines with consensus at around another 10 million job losses. However, all eyes will be on the unemployment rate with some expecting it to top 20%, hitting levels not seen since the Great Depression.
Senior White House officials are bracing for a downbeat report with Kevin Hassett, a senior White House economic adviser, saying the unemployment rate could be “north of 20%”.
Meanwhile, the Australian employment report will be closely eyed as well, with expectations for a further jump in the country’s unemployment rate from 6.2% in April. However, Australia has managed to control the spread of coronavirus, while keeping some sectors of its economy open. Given this, the employment report will be a good gauge of the economic benefits in keeping some sectors of the economy running, while bringing the coronavirus under control.