Here's our summary of key economic events overnight with news the bond market is over yesterday's retreat and yields are rising again today.
But first, new claims for jobless benefits in the US hit a new and impressive low last week, falling again so that they are now their lowest level since September, 1969. There are now 1.73 mln people on these benefits. Their insured jobless rate is now just 1.3% of their workforce, and that is a record all-time low. (The highest ever was during the Trump pandemic at just under 16%.) It also backs up the overall very low general jobless rate of 3.8% in February and strongly suggests it will be reported lower than this when the March data is released in about two weeks.
But it is not all good news in the world's largest economy. Core durable goods orders for February were expected to rise from January, but in fact they fell. It wasn't much, but is was a slip all the same. If you include aircraft and defense orders, the fall was more. But on a year-on-year basis they were up +12.5%, and capital goods orders were up +13.3% on that basis.
Orders might have slowed marginally, but activity is increasing. The latest March PMI data from the Markit surveys points to rising levels in factory activity and a six month high. Their services sector is expanding just as fast and now at an eight month high.
The regional Kansas City Fed factory survey is also reporting a growing expansion, in fact growing at a record pace.
In Japan, the Markit survey records a small contraction.
It is clearer now that container shipping rates from China are falling, and noticeably. Bulk cargo rates seemed to have topped out at a moderate level. Transpacific cargoes are still at high levels, although ship wait times in Los Angeles have eased further. One reason may be because Vancouver is picking up much more traffic.
Across the Atlantic, EU PMIs are suffering. These Markit PMIs for March report that growth is slowing, exports are falling, business sentiment is slumping and prices are rising at a record rate, all of course because of the Russian invasion of Ukraine. But they are still expanding despite this crisis. Output price inflation it a new record high in Germany.
In Russia, they re-opened the Moscow stock exchange and prices rose, up +4.4%. But it may not be all it seems. Foreigners were barred from selling. Short selling was banned. And their sovereign wealth fund flooded the market with 'buy' orders. And then when these effects were waning, the market was unexpectedly closed after only 4 hours of trading. The net effect was that oligarch wealth was preserved, on the surface at least.
In the South Pacific, leaked documents show that China is close to securing a naval base in the Solomon Islands. The proposal includes allowing Chinese police, armed police and the military to assist the Solomon Islands on "social order".
In Australia, their PMIs are expanding in both their manufacturing and services sectors and at a healthy clip. But this survey also notes record price pressures.
The UST 10yr yield opens today at 2.35% and a +4 bps rise from this time yesterday. The UST 2-10 rate curve starts today a little steeper at +22 bps. Their 1-5 curve is also a little steeper at +84 bps. Their 30 day-10yr curve is unchanged at +218 bps. The Australian ten year bond is back up +8 bps at 2.77%. The China Govt ten year bond is -2 bps lower at 2.85%. And the New Zealand Govt ten year is also lower by -4 bps at just on 3.32%.
On Wall Street, the S&P500 has opened up +0.8% in Thursday afternoon trade and is now +1.1% higher for the week so far. Overnight, European markets were mixed in the +0.2% / -0.2% range. Yesterday, Tokyo started sharply negative but ended positive, up +0.3%. Hong Kong fell -0.9% and Shanghai ended down -0.6%. The ASX200 ended its Thursday session up a minor +0.1% while the NZX50 dropped again, down -0.4%.
The price of gold starts today at US$1963/oz and up another +US$29/oz from this time yesterday.
And oil prices are down by -US$1 to US$112.50/bbl in the US. And the international Brent price is now just on US$117/bbl.
The Kiwi dollar will open today marginally softer, now at just on 69.5 USc. Against the Australian dollar we are down at 92.7 AUc. Against the euro we are soft at 63.2 euro cents. Only against the tumbling Japanese yen are we gaining. That all means our TWI-5 starts today at just at 74.8 and now off our four month high.
The bitcoin price is up +3.3% from this time yesterday at US$43,954. Volatility over the past 24 hours has been moderate at +/- 2.5%.
The easiest place to stay up with event risk today is by following our Economic Calendar here ».
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