Here's my summary of the key news overnight in 90 seconds at 9 am, including news of another -6% fall in dairy prices in the latest dairy auction.
But first, American construction spending rose strongly in July to its highest level in more than 5 years. Private construction increased and state and local government outlays surged. It is a very positive signal for the US economy.
And backing up yesterday's PMI data, today's ISM survey showed factories in the US are busy and expanding. Their index was at its highest level since March 2011 and records 63 months of expansion. New order levels were especially strong.
The Fed will be looking for rising wage levels now, its key marker for when to consider normalising its interest rates. It might not have long to wait. Markets are now picking June 2015 for that. The end of bond buying is imminent and on schedule.
Across the Atlantic, its not so rosy. Apart from Vladimir Putin saying he could "take Kiev in two weeks", the Swiss economy unexpectedly stalled in the second quarter as stagnating growth in the euro area hurt their exports.
In Japan, their wages unexpectedly logged their strongest increase since 1997, providing a boost to the government's battle against deflation. Labour cash earnings rose by 2.6% in July compared to a year ago. Summer bonuses grew by an annual +7% in July from a revised +2% gain in June.
The latest globaldairytrade auction overnight saw prices fall -6% in US dollar terms, but down less -4.7% in NZ dollar terms. The big falls were for skim milk powder which dropped -9.5% to US$2,600/tonne. Butter fell -5.6%, cheese fell another -4.9% and WMP fell -4.3%. These changes are from the last auction just two weeks ago. Overall, prices are down -42% from a year ago, down -45% in NZ dollars.
US stock markets were lower after their long weekend. The UST 10yr benchmark bond rose to 2.41% which is a big jump on the day and will no doubt be reflected here later in our swap rates.
The price of oil fell markedly overnight. It is now down under US$93/barrel in the US and almost under US$100/barrel on the Brent benchmark. Gold also fell sharply, now at US$1,262/oz.
We start today with the currency lower, not only on the dairy auction, but more on a surging US dollar. We are now just on 83.1 USc - the lowest we have been since February earlier this year - , 89.6 AUc, and the TWI is at 78.4.
If you want to catch up with all the changes 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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