OPEC rattles central bankers

<p>Kia ora,</p><p>Welcome to Monday’s Economy Watch where we follow the economic events and trends that affect Aotearoa/New Zealand.</p><p>I'm David Chaston and this is the international edition from Interest.co.nz.</p><p>And today we lead with news central bankers will be waking up today with a new inflation threat.</p><p>More generally though, it will be a busy week in the US with non-farm payrolls, JOLTS job openings, ISM services and manufacturing PMI, and external trade data all due to be released. Elsewhere, inflation rates will be released for South Korea, Switzerland, Mexico, Philippines, Indonesia, and Turkey. Then the central banks chime in. India, Australia, and of course New Zealand are among those that will review their monetary policy settings. Finally, more PMI figures are set to show the state of the manufacturing sector in China, India, Russia, South Korea, Canada, and some of the larger EU countries.</p><p>But first up today we have <a href="https://www.reuters.com/business/energy/sarabia-other-opec-producers-announce-voluntary-oil-output-cuts-2023-04-02/" target="_blank"><strong>a sharp oil supply cut</strong></a> announced by OPEC earlier today. They are reducing supply by -1 mln/bbl/day. Markets weren't expecting this, and OPEC clearly want a higher price. Saudi Arabia led the cartel by pledging its own -500,000 barrel-a-day supply reduction. They were followed by Kuwait, the United Arab Emirates and Algeria. Russia said the production cut it was implementing from March to June would continue until the end of the 2023. The move is likely to complicate central bank efforts to rein in inflation.</p><p>In other news, we can report that Taiwan's factories held all their February recovery in March but couldn't quite break back to an expansion mode. The downturn in production continued to ease, while firms signaled only marginal drops in new orders and employment in the latest <a href="https://www.pmi.spglobal.com/Public/Home/PressRelease/69d186b0e00c4e419921966232ae1f08" target="_blank"><strong>PM