Here's my summary of the key news over the weekend in 90 seconds at 9 am, including news of slightly disappointing US jobs news.
The eagerly awaited US employment data for July was out on Saturday morning. The US economy added 209,000 jobs last month, lower than expected but still it was the fifth straight month of employment gains above 200,000 and added to optimism that their recovery was continuing at a good pace.
For all that however, their participation rate is stuck at a low level, 62.9% (72.0% for men, 58.5% for women). The US Fed is waiting to see more people get back into their labour market and wages start to rise before they will start raising interest rates.
Over the weekend in China, their central bank said it will refrain from broader monetary easing to support growth after warning of the dangers from the country’s rapid growth in credit and their money supply.
And on Saturday, there was a major set of business data released for July. Firstly, the Chinese services sector stumbled slightly coming in at a six-month low as new orders rose at their weakest rate in at least a year. Still, the sector is still expanding well by any measure.
US factory output growth has held close to its 50-month high, India's factory PMI hit a 17 month high, while the Eurozone barely showed any expansion. Perhaps the surprise of the releases was that Australian manufacturing sector moved into expansion mode in July following eight months of contraction. In fact, only six of twenty five key economies countries surveyed recorded contraction, so the world's factories are in good shape.
However, the grand global free trade agreement drawn up in meetings in Bali last December has finally failed. It was blocked over a number of fundamental disagreements mostly by developing nations and mostly relating to agriculture, including India's demands for concessions on the stockpiling of food.
The focus now goes back on to the big regional agreements like the TransPacific Partnership and the TTIP.
In Australia, there are strong indications they too may adopt a Volker Rule where Australia’s banks have to legally separate their trading arms from their lending and deposits businesses. It is David Murray who is making the suggestion.
After the sharp equity market falls on Friday in New York, UST 10yr yields fell back too to 2.49%.
The oil price has fallen further on the US benchmark and is now under US$98/barrel. On the Brent benchmark it is now under US$105/barrel. Gold however rose and is now at US$1,293/oz.
We start today with the NZ dollar unchanged from where we left it at the end of last week. We are now at just under 85.0 USc, just under 91.5 AUc. The TWI is at 79.7.
If you want to catch up with all the changes on Friday we have an update here.
The easiest place to stay up with today's event risk is by following our Economic Calendar here »
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