Here's my summary of the key events overnight that affect New Zealand, with news we still are right up there in the happiness stakes.
But first, sales of existing US homes fell more than expected in February from January amid a persistent shortage of houses on the market that is pushing up prices and sidelining prospective buyers. However, volumes were still +5.4% ahead of where they were in the same month ago. The median price is up to US$228,400 (NZ$324,000) and that is an annual gain of +7.7%. This is a market where all-cash sales account for 27% of all sales, and first home buyers account for 32%.
American mortgage applications fell too.
In China, new rules limiting to only AAA-rated corporate bonds that can be used as collateral for short-term loans, is expected to sharply raise yields, forcing bond price losses in investors. It is a de-risking move by the private market regulator.
And Chinese iron ore prices are on the skids, after a run-up that many saw as unsustainable.
The Gallup organisation has been polling happiness/satisfaction with life and New Zealand is ranked #8 in their list, almost equal with Canada who is the highest non-northern European country. Norway tops the list. These non-financial measures are important predictors of elections, it seems.
The next New Zealand Reserve Bank review of the OCR is due at 9am and we will have full coverage.
In New York, the UST 10yr yield has slipped another -3 bps today and is now at 2.39%. That is a -21 bps fall in just two weeks. Investor concerns about the Trump administration are growing.
Oil prices are still softish and now just under US$48 for the US benchmark, while the Brent benchmark is under US$50.50 a barrel. The latest survey of US crude oil stocks show them higher than expected - again - and that won't be helping prices.
The gold price however is up another +US$6 to US$1,248/oz.
And the New Zealand dollar starts today at the same level it was at this time yesterday at 70.6 USc. On the cross rates the Kiwi dollar is at 92.1 AU¢, and against the euro is at 65.3 euro cents. The NZ TWI-5 index is at 75.4.
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 ».
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9 Comments
Nevertheless people are still buying. It is good that there is a greater selection and more opportunity for bargaining and setting conditions. The super hot market was the anomaly, that lasted too long, and what we are seeing now is a return to a more normal market.
We have a census in 12 months and that needs targeted questions to establish trends in occupation rates etc. Also as the previous census was delayed by two years due to CHCH EQ we need the next census brought forward by two years to follow up on these rates. Better than a Gallup poll.
In New York, the UST 10yr yield has slipped another -3 bps today and is now at 2.39%. That is a -21 bps fall in just two weeks. Investor concerns about the Trump administration are growing.
Hmmmmm...
The lack of bond market reaction to the past two hikes (or the first one at all), apart from the selloff from July to November in anticipation, is about re-assessment of opportunity and not monetary policy. Things looked particularly bleak in early and mid-2016, but somewhat less so by the start of 2017. That is still not anywhere close to good, and is much more like Japan than anyone seems willing or even able to admit. Read more
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