Here's my summary of the key events from over the weekend that affect New Zealand, with news of some major tax changes over the weekend.
But first in the US, the Fed's preferred measure of inflation, the change in Personal Consumption Expenditure (PCE) was out over the weekend and for the third month in a row, it declined. It was +1.4% in May. Interestingly, personal income was +3.5% higher that the same month a year ago.
China's summer transport peak period began Saturday, with almost 600 mln passenger train trips expected to be made by the end of August when the summer season ends. That is 50 mln more trips that for the same period last year.
And China's official PMI measures have both come in strongly positive for June. The factory measure rose to its highest in three months and near its second highest since 2013. It services PMI scored similarly.
In Hong Kong, Chinese President Xi warned Hong Kongers, where a pro-democracy movement has provoked mass protests in recent years, saying that challenges to mainland sovereignty won’t be tolerated. He said any attempt to endanger China’s sovereignty and security, challenge the power of the central government, or "use Hong Kong to carry out infiltration and sabotage activities against the mainland" is an act that crosses a red line for Beijing. But 60,000 protesters on the streets of the city rallied to rebuke him.
The first export China-bound consignments of chilled meat have left New Zealand as part of a six-month trial. The air-freighted consignments from Alliance, and from Greenlea Meats mark an key step towards permanent access for New Zealand chilled meat to China. This is an up-market trade.
Over the weekend and after a special midnight parliamentary session, India has triggered its massive national GST system. It has replaced its numerous federal and state taxes which it hopes will unify the country into a single market. Higher economic growth is a goal. There are now four basic GST rates - 5%, 12% 18% and 28%. Some items like vegetables and milk have been exempted from GST, but they will still be subject to existing local taxes. At the same time, it cancelled the registration of over 100,000 companies that it said were breaching tax laws.
In Australia, another emergency tax change has instituted a 12.5% special tax on foreigners selling property there if the value is over $750,000 - which accounts for just about everything in Sydney and Melbourne. These are new ATO rules introduced to stop foreign property owners avoiding capital gains tax.
In New York, the UST 10yr yield ended the week on a six-week high, and is now at 2.30%.
The price of oil is certainly higher today, rising to just under US$46.50 a barrel, while the Brent benchmark is now just on US$49. The growth of the US rig count has leveled out in data released overnight.
The gold price has slipped however and is now just under US$1,240/oz.
But the Kiwi dollar has bounced back up again and is now at 73.3 USc. On the cross rates we are up as well at 95.4 AU¢, and at 64.2 euro cents. The TWI-5 index is up to 77.1.
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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16 Comments
Canada and Australia are both much bigger country than ours so in terms of supply also, small country like ours should have acted much earlier to control speculative demand and forign money ( money laundering) atleast in exesting supply of house, which locals are struggling to get in.
A government more concern about rich and foriegners than average kiwi.
Yeah, it is good news that election in nearly 2 months time.
in good news the waterview tunnel is open, in bad news it is already congested
http://www.journeys.nzta.govt.nz/traffic-and-travel-information/aucklan…
Stuff are reporting that it's all going well. Early days yet. I imagine it will take a week or two for people to settle into a pattern
https://www.stuff.co.nz/motoring/94315475/congestion-fears-on-day-two-o…
Prime Minister Shinzo Abe's Liberal Democratic Party suffered an historic defeat in an election in the Japanese capital on Sunday, signaling trouble ahead for the premier, who has suffered from slumping support because of a favoritism scandal.
On the surface, the Tokyo Metropolitan assembly election was a referendum on Governor Yuriko Koike's year in office, but the dismal showing for Abe's party is also a stinging rebuke of his 4-1/2-year-old administration.
"We may discover that Japan is not all that different from Britain, France, and the U.S. in its ability to produce a big political surprise," he said, referring to recent elections in those countries. Read more
The first export China-bound consignments of chilled meat have left New Zealand as part of a six-month trial.
Let's hope our allies don't dent the prospects of permanent sales.
Taking a cue from Washington, the Japanese government has imposed sanctions on the Bank of Dandong, a regional bank in China which is accused of financing North Korea’s nuclear and missile program. Chief Cabinet Secretary Yoshihide Suga announced the decision during a news conference in Tokyo. Read more
Best Korea is great for drama, but not so good for sustained war. They make noise to try to get badly needed funding to prop up the regime. They know that if they use a nuclear weapon that would focus the Western Alliance on dealing with the issue (and leave China holding the bag with people fleeing Best Korea and entering China).
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