Dairy prices hold; RBA also holds; a flood of China bond demand coming; expensive Danish defense; BofE currency boss fired; UST 10yr yield 2.09%; NZ$1 = 75.7 USc, TWI = 79.3

Here's my summary of the key issues from overnight that affect New Zealand, with news dairy prices stabilised in the overnight auction.

For the sixth straight time since mid December, dairy prices have risen at the Fonterra auction. But this time they were only up marginally with a gain of just +1.1% overall.

Good rises were recorded for SMP (+5.9%), butter (+2.5%) and cheese )+10.8%), but the high-volume wholemilk powders saw a slight fall of -1.0%. As had been signaled many months ago, volumes offered and sold were a light 22,094 tonnes and the lowest since May 2013 although right near the top of the range offered last night.

In New Zealand dollar terms the overall rise was just +0.4% on a rising kiwi dollar.

These results consolidate the market turn higher but more double digit price rises, especially for WMP, are needed to lock in the $4.70 payout price or have any chance of raising it.

Late yesterday afternoon, the Reserve Bank of Australia surprised many in the markets by holding the cash rate at 2.25%. This saw the Aussie dollar surge higher and their share market take a hit. The RBA did say more rate cuts  - or in their language, "further easing" - is still on the cards. Maybe as early as next month.

In China, the China Three Gorges Corp, the operator of the world's largest hydroelectric power project, is joining a line of State-run Chinese companies looking to issue bonds overseas for the first time. This may be part of a new and very large surge in bond supply which could soak up significant amounts of global liquidity and together with the US Fed's planned rate rises start to push up global bond yields.

It can be very tough being a central bank in Europe but outside the eurozone. Denmark's central bank had to intervene massively in currency markets last month to keep their currency - the krone - from strengthening too much against the euro and damaging their economy. It spent NZ$33 bln in one month. It needed to in response to the ECB's stimulus plan. No doubt more will be needed. The loss risks are very high indeed.

In England the boss of their central bank today revealed that he has fired his chief currency trader for multiple breaches of internal policies, and not because he failed to flag potential misconduct in the currency market as had been widely assumed. They got rid of him for sharing an internal Bank of England document with market participants, offering personal opinions about bank policy, using bad language and sending emails with inappropriate attachments. Cavalier behaviour is apparently not only common in the markets but the regulators as well - and at senior levels.

The UST 10yr yields recorded another healthy rise in New York earlier today and are now at 2.09% as markets accept the Fed's now-consistent message that it will raise rates in a few months.

The crude oil price rose to just over US$51/barrel and the Brent crude price has risen to just over US$61/barrel. Renewed fighting in Libya was behind the slight rises.

The gold price fell again and is now at US$1,202oz.

The New Zealand dollar starts today higher at 75.7 USc, 96.5 AUc and the TWI is back up to 79.3.

If you want to catch up with all the changes yesterday, we have an update here.

The easiest place to stay up with event risk is by following our Economic Calendar here »