Here's my summary of the key events overnight that affect New Zealand, with news the world is actually moving quite quickly to work around Washington.
Firstly, moves by large trading countries to work without the US are gathering steam. Japan and the EU (Germany) are working on a big deal. The EU and China are as well. These moves come as China ramps up its 'leadership' to strike large multilateral trade arrangements. Without the US involved, these deals may take less time to negotiate. There may not actually be any 'America First' deals, only 'without America' deals.
Politics is also hurting the world's number one tourism market. The US ranks number one in the world in terms of the sector’s contribution to GDP, twice the size of the nearest competitor, China. That was in 2016. In 2017 American border control uncertainty is diminishing the appeal quickly. Global tourism is booming, so while American destinations suffer, others will get a growth boost. And given the size of the diversion, the boost could be significant.
An example of the explosive growth of travel is the +17.6% rise in China in 2016, led by international travel growth.
The growing scandals surrounding the supply of tainted meat are hurting Brazil - and will create short-term opportunities for New Zealand beef, especially in China where a temporary ban on importing the Brazilian versions has been put in place.
In Australia, the head of ASIC has called for the power to impose larger penalties on financial institutions, at least a multiple of the damage they cause. He is concerned that the current penalty limits allows only a token censure. For example, the rate rigging scandal brought the maximum A$3 mln fine for a billion dollar scandal.
And staying in Australia, concerns about the potential damage a housing bubble bursting could cause now has the attention of the Federal Treasurer. Regulators will be emboldened to impose tougher standards, especially on 'investors'/speculators.
In New York, the UST 10yr yield has slipped -2 bps to start the week and is now at 2.48%.
Oil prices are softer today at just over US$48 for the US benchmark, while the Brent benchmark is under US$52 a barrel.
The gold price however is unchanged at US$1,231/oz.
And the New Zealand dollar starts today just a little bit higher again at 70.5 USc. On the cross rates the Kiwi dollar is at 91.2 AU¢, and against the euro is at 65.6 euro cents. The NZ TWI-5 index will open at 75.5.
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 today is by following our Economic Calendar here ».