Here's our summary of key economic events overnight that affect New Zealand with news both Turkey and bitcoin have taken a sharp re-rating lower today.
But first in the US, new jobless claims fell to 239,000 and the number of people on these claims is now 1,754,000 and back to pre-pandemic levels. These new levels are about what was expected.
The Philly Fed manufacturing survey reported buoyant conditions and continuing fast-rising cost and price rises. New order levels were strong.
The Kansas City Fed factory survey wasn't so upbeat, still growing but at a slower pace. However they too reported strong new orders, high cost and price increases and a very tight labour market.
All this American data is consistent with the Conference Board's leading index which rose sharply in October suggesting the current economic expansion will continue into 2022 and may even gain some momentum in the final months of this year.
The Canadian ADP payrolls report for October was stronger, and an improvement from September. But not every sector shared in the bounceback.
In Vancouver, panic buying has emptied stores in a city now cut off by debris on major highways and rail lines. The province's death toll of one is expected to climb. The military is due in the area soon to assist rescue efforts.
In China, infrastructure investment is very weak now, growing just +1% year on year in the first ten months of 2021. And it could slip further. And separate data confirms their birth rate is very low, and falling.
In Turkey, their central bank slashed its one-week repo auction rate by -100 bps to 15% during its November meeting, following a -200 bps cut in October and a -100 bps cut in September. The move was expected after Turkish President Erdogan, who backs an unconventional theory that high rates cause inflation, vowed to fight for lower rates as his country grapples with inflation at near 20%, well above the mid-point target of 5%. The Turkish currency is down almost -11% in November and may well fall further, adding to their inflation. Erdogan mimics Trumpish ignorance about how financial markets work and react. He will impoverish his country.
Shipping freight rates out of China are staying very high, according to this week's assessments. Some thought it might be reverting lower by now, but that hasn't happened yet. But the Baltic Dry index is one cost that is reverting lower.
The price of lithium just keeps on rising however.
In Australia Delta cases in Victoria have risen to 1006 cases reported there yesterday. There are now 13,814 active cases in the state and there were another 12 deaths. In NSW there were another 262 new community cases reported yesterday, another drop, with 2,894 active locally acquired cases, and they had 3 deaths. Queensland is reporting zero new cases again. The ACT has 25 new cases. Overall in Australia, just under 84% of eligible Aussies are fully vaccinated, plus 7% have now had one shot so far.
The UST 10yr yield opens today at 1.58% and -2 bps softer than this time yesterday. The US 2-10 rate curve starts today flatter at +108 bps. And their 1-5 curve is little-changed at +106 bps, while their 3m-10 year curve is a little flatter at +153 bps. The Australian Govt ten year benchmark rate is -2 bps lower at 1.81%. The China Govt ten year bond is unchanged at 2.94%. The New Zealand Govt ten year is -4 bps softer at 2.60%.
In equity markets, the S&P500 is up +0.2% on Wall Street in their afternoon Thursday session. Overnight, European markets were all down about -0.2% except London which fell another -0.5%. Yesterday the very large Tokyo market closed down -1.3%. Hong Kong closed down -0.5%, and Shanghai closed down -0.9%. The ASX200 ended with a minor +0.1% gain, but the NZX50 was down another -0.3%.
The price of gold will start today down -US$6 to US$1861/oz.
And oil prices are also a little softer at just under US$78/bbl in the US, while the international Brent price is now just on US$80/bbl.
But the Kiwi dollar opens today firmer at just on 70.3 USc. Against the Australian dollar we are another +½c firmer at 96.7 AUc, so up +1c in two days. Against the euro we are little-changed at 61.9 euro cents. That means our TWI-5 starts today at 74.8 and up +40 bps since this time yesterday.
New data shows that the Chinese yuan is making virtually no progress in being accepted in international payments. If garnered just a 1.22% share of all global payments in October, up from 1.08% two years ago. The big gainer is the euro at the expense of the US dollar, and not the yuan. The NZD is used in 0.38% of transactions, unchanged, which put the yuan in perspective.
The bitcoin price has fallen again since this time yesterday, down -4.8% to US$57,466. In NZ dollars that is a drop of more than -NZ$10,000 in a week. Volatility over the past 24 hours has been high at just over +/-3.2%.
The easiest place to stay up with event risk today is by following our Economic Calendar here ».