Here's my summary of the key events over the weekend that affect New Zealand, with news American business leaders are showing hesitation in investing in their own country.
US durable goods orders rose in February on the back of strong aircraft orders. Other categories are largely stable and it is notable that high consumer sentiment has not yet translated into stronger demand for factory equipment. In fact, the flash March readings for American PMI shows their factory expansion at its lowest level in five months, and their services expansion at its lowest level in six months. While these may be retreating from high levels the decline in business signals is something to watch.
That contrasts with Japan which is seeing quite a rebound in their factory sector. The Japanese are feeling quite good about where they are at present with a much restrained 'fiscal impulse', and the Bank of Japan actually tapering its holding of Japanese Government bonds - something generally unnoticed outside Japan.
In Hong Kong, China has engineered the appointment of its favoured candidate as the territory's new 'Chief Executive' by using a stacked group of 1186 'electors' and winning 777 of them. In fact, citicising the Chinese Government even from afar can have unfortunate consequences. And the visit by China's Premier here this week will likely skirt the growing influence the Chinese Government puts on expat communities, even in New Zealand.
In Brazil, they are reporting that bans on their beef have been lifted by China and a number of other countries.
The Russian central bank has cut its key rate to 9.75% and signaled more cuts would probably follow as inflation is on the way to hitting the bank's target of 4%. It is a move that has surprised markets. The bank said it is assuming oil prices would fall to US$40 per barrel by the end of the year.
In Australia, Sydney's auction clearance rate rose to over 81% last week, its highest so far this year. Melbourne and Canberra had clearance rates just shy of 80%, according to preliminary results advised by CoreLogic.
In New York, the UST 10yr yield is up a little today and is now at 2.42%. CDS spreads continue to fall, with investment grade corporate debt attracting lower margins. New Zealand's sovereign debt is also being priced with CDS spreads narrower. And this may narrow even further with Moody's affirmation of its Aaa sovereign rating.
Oil prices are unchanged at just under US$48 for the US benchmark, while the Brent benchmark is over US$50.50 a barrel. The US rig count is now up over 800 for the first time since October 2015, and new reports show that American gas shipments from their shale fields are moving in to Europe, a market long dominated by Russian gas supplies. And in the Middle East, bankers are reporting that there is a surge of borrowing by oil producers.
The gold price is virtually unchanged at US$1,248/oz.
And the New Zealand dollar starts today also unchanged at 70.3 USc. On the cross rates the Kiwi dollar is at 92.2 AU¢, and against the euro is at 65.1 euro cents. The NZ TWI-5 index is at 75.2.
If you want to catch up with all the changes on Friday, 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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