Here's my summary of the key events overnight that affect New Zealand, with news that even more revelations about cheating are emerging from VW.
But first, American employers maintained a steady pace of hiring in October and a jump, especially in new orders, buoyed activity in the services sector, suggesting their economy was ready for a first interest rate hike from the Fed in December. Reinforcing the theme was a smaller US trade deficit in September, the smallest in 7 months, with exports up and imports down. Even Janet Yellen said the American economy was 'performing well' and ready for the start of rate hikes.
At the same Congressional hearing, she said that while the state of big US banks has "strengthened considerably" since the crisis, they still have "substantial compliance and risk-management issues".
China's stock markets soared yesterday with the Shanghai index up more than +4% and the Shenzhen index up +5%. But the move was prompted by official comments published yesterday - that were apparently made five months ago.
In Europe, and ironically ahead of the UN climate conference in Paris, the pressure on Volkswagen has been raised to new levels after it was revealed that the carmaker has also cheated on CO2 emissions and fuel economy results. The crisis at one of the world's largest industrial enterprises now threatens its very existence. The crisis is also not helping Europe's reputation for advanced engineering.
In Australia, their exports of iron ore to China are fading fast; in fact, one US rival said that both BHP and Rio are in denial about the implications.
In New York today, the UST 10yr yield benchmark has held at 2.20%.
The US benchmark oil price has also slipped today, now at US$46/barrel, and the Brent benchmark is at US$49/barrel. American crude oil stocks jumped last week. Ethanol production is soaring too despite low prices. Fuel everywhere.
The gold price also fell overnight, now at US$1,112/oz.
The New Zealand dollar starts today about 1c lower on a stronger US dollar and reaction to both lower dairy prices and the weaker local jobs report yesterday. It is now at 65.8 US¢, at 92.1 AU¢, and at 60.6 euro cents. The TWI-5 is at 71.1.
If you want to catch up with all the local changes yesterday, we have an update here.
The easiest place to stay up with event risk today is by following our Economic Calendar here »
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12 Comments
This article on the institution of a 'soda (sugar in drinks) tax' in Mexico is a wonderful (if long) read. The parallels with NZ are eerily obvious:
http://www.theguardian.com/news/2015/nov/03/obese-soda-sugar-tax-mexico
''Armando Ahued Ortega, Mexico City’s secretary of health, has often warned that diabetes is causing the collapse of Mexico’s health system. And dialysis (kidney failure is a major consequence of diabetes) isn’t even covered. If it were, the health system could pay for nothing else. “There goes everything else social security covers – cataracts, cancer, everything,” Ahued said in 2013.''
Here in NZ the Health Promotion Agency has former members of the food and liquor interest group the Food Grocery Council as sitting members.....sound familiar?
http://www.stuff.co.nz/national/health/66427410/Ties-to-liquor-industry…
I had a great friend in Pittsburg who worked at the University, he was a Surgeon in WWII, one of the youngest. He was adamant that there were two diseases that were going to collapse the Western healthcare industry, they were Diabetes and Depression.
That was in the late 80's and he spoke at various meetings about the problem, the corporate food industry won't give up without a fight, we are all going to have to live with the consequences for decades.
https://ccamatil.co.nz/news/media-statement/
If a packet of smokes still cost $1 I'd probably still be smoking, so I think taxes can be helpful, the difficulty these days seems to be finding something to eat that won't give you some kind of disease or cancer. I'm looking at how I can turn my pork into bacon without using carcenogens or risking botulism, it's not easy ;)
Our do nothing Minister (Coleman from Birkenhead) has no interest in a sugar tax.
http://www.stuff.co.nz/national/politics/69769611/Sugar-tax-off-the-tab…
Probably nothing to do with the Chelsea refinery location but its symptomatic of National's "lets do nothing until we are pushed into a corner" attitude as has happened with housing and money laundering. They don't listen to the people, only lobbyists.
..further case in point being fluouridation and now outdoor smoking areas. The do nothing govt imposing this obligation on councils to make the laws locally - both are national issues, requiring consistant national laws.... but as they are contentious issues and potentially vote loosers, they dump the issue on the councils to take the flack!
the stated fuel economy is with the windows closed, a/c off, empty car (only driver), and extremely slow acceleration away from the lights.. Who drives like that? Everyone's driving is different and so the ratings, as with most ratings, are not so much useful as an indication of absolutes, but rather helpful to compare against other vehicles. Of course this assumes all manufactures are playing by the same rules when they run the tests.
I saw this a few days ago about China building a massive computer memory chip plant. They want to do this because they need secure computer systems and they seem to have accelerated theor efforts due to the signing of the TPP.
So we are going to see massive global oversupply in the tech industry due to China import substitution just like we are seeing with dairy oversupply.
This has been brought about by the Snowden revelations and Chinese reluctance to be vulnerable in a TPP led trade war against China.
So the TPP that is supposed to make everyone richer is going to bring depression to some sectors of the western economy.
http://asia.nikkei.com/Business/Trends/China-set-to-challenge-global-ch…
China's stock markets soared yesterday with the Shanghai index up more than +4% and the Shenzhen index up +5%. But the move was prompted by official comments published yesterday - that were apparently made five months ago.
Unreal real - and the dish ran away with the spoon.
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