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US jobless claims at 8yr low; ECB holds rate, warns of risks; Aussie jobless rate worries; NZ to be 'super aged'; Mexico opens its oil patch; UST 10y 2.44%; NZ$1 = US$0.847, TWI = 79.5

Posted in News
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Here's my summary of the key news overnight in 90 seconds at 9 am, including news NZ is a country tagged as about to be 'super-aged'.

But first, American initial jobless claims came in low last week, in fact at more than an 8 year low. The trend here is quite impressive and supports the view that the US jobs market is healing in a steady way.

Across the Atlantic, the European Central Bank kept its benchmark interest rate on hold at 0.15% for another month as it looks to see how measures unveiled previously are working. Mario Draghi also said risks to the euro area’s economic recovery are increasing because of conflicts such as the Ukraine crisis.

There has been a sharp jump in credit spreads recently.

In Australia, their highest unemployment rate in 12 years has brought forward bets on an interest rate cut by the Reserve Bank as traders increasingly believe the economy will need some form of stimulus. The Aussie unemployment rate is now higher than the American one.

And ratings agency Moody's is reporting there will be 13 'super aged' nations by 2020, those with at least 20% of their population above the age of 65. New Zealand is one of them. China won't be by that date, but the report noted that China is aging very fast.

Equity markets faded today in New York and Wall Street is heading for a daily loss; UST 10yr yields fell back again to 2.44%. The oil price got down as low as US$96/barrel in the US although it is above that now, Brent is US$105/barrel. Gold however jumped again and is now at US$1,313/oz. It is curious that the oil and gold markets are going separate ways.

Perhaps one reason is that Mexico's Congress approved sweeping changes to the country's energy industry which will see private oil contracts awarded for the first time since 1938.

We start today with the NZ dollar up against the Aussie following their bad jobs numbers. We are now at just over 84.7 USc, just under 91.4 AUc. The TWI is at 79.5. 

If you want to catch up with all the changes on yesterday 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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9 Comments

Russians food embargo has

Russians food embargo has ‘serious consequences’ for Australian dairyMr Helou said it was particularly galling that Australian dairy imports had been banned, but not New Zealand products.
 
 
 
 

 

http://www.theaustralian.com.au/national-affairs/foreign-affairs/russians-food-embargo-has-serious-consequences-for-australian-dairy/story-fn59nm2j-1227017297696?nk=fe1659e1fccbb8e921ca33215c2a167d

yes, however a greater

yes, however a greater commercial effect to be felt by Danone (amped given their gearing approx. 40% equity)
http://media.corporate-ir.net/media_files/IROL/95/95168/Docs/Danone_Results_H1%202014%20WEBCAST.pdf
see their view on upstream milk
http://media.corporate-ir.net/media_files/IROL/95/95168/presentations/24_06_2014_DANONE_INVESTORSEMINAR_BASSIN.pdf
and here
http://finance.danone.com/phoenix.zhtml?c=95168&p=irol-results
I think the result is absolutely valuable, because we have something which is far more sustainable now. We have, not working yet but it's going to be working very soon, our own supply of milk in New Zealand, with a dryer connected to a milk collection area.
 
http://finance.danone.com/phoenix.zhtml?c=95168&p=irol-presentations
 
 

I think Putin is more

I think Putin is more interested in causing Chaos, than a plan to support the BRICS and little old us. Imagine the products being diverted.
 
 
http://www.zerohedge.com/news/2014-08-07/checkers-vs-chess-reason-europe...

tis a great and happy

tis a great and happy country
https://www.youtube.com/watch?v=xyuwprMDKIQ
 

But Danone is now appealing

But Danone is now appealing that High Court decision and filed the documents with the Court of Appeal today.
The company believes the High Court judge erred "in law and in fact in granting the temporary stay" on its case, a spokeswoman said.
http://www.nzherald.co.nz/business/news/article.cfm?c_id=3&objectid=11306073
mind you French entities have form in respect for accepting local court process
Prieur and Mafart pleaded guilty to manslaughter and were sentenced to 10 years' imprisonment on 22 November 1985. France threatened an economic embargo of New Zealand's exports to the European Economic Community if the pair were not released.
 

Interesting how resilient

Interesting how resilient financial markets and interest rates are even during war, e.g. wWI and II.  http://www.federalreservehistory.org/Events/DetailView/17
so if Russia moves militarily, and world opinion turns against Israel, and the dysfunctional Arab States keep disintegrating -    Effect on Economics?   

And now we have women

And now we have women soldiers it a whole new ball game
 
 
https://www.youtube.com/watch?v=-4EDhdAHrOg

War would be ideal.  It's

War would be ideal.  It's great for employment and would help turn around our flagging manufacturing industry.  GDP would go through the roof with all the canteens and uniforms being produced etc.  Would help solve the housing problem and put a dent in the world over population problem.  Instead of work for the dole scheme we could have a fight for the dole scheme that will get the riff raff out of our hair.   
 
Ideally one of our major cities should be bombed into the ground.  Think of all the employment opportunities and growth stemming from the rebuild.

India’s Rajan Sees Risk of

India’s Rajan Sees Risk of New Crisis on Loose Monetary Policies
 
 

 

http://www.bloomberg.com/news/2014-08-06/rajan-sees-risk-of-new-crisis-on-loose-policy-cb-journal-says.html