Here's our summary of key economic events overnight that affect New Zealand with news the world's dominant financial market is closed today, so this will be a thin report. Wall Street will be back in a limited capacity tomorrow (their Friday).
In the US, a record 80 mln people are expected to travel at least 100 kms this holiday weekend.
But the Canadians are not on their Thanksgiving holiday break. They have it on the second Monday in October, so it has already been for them.
And new data shows on average, Canadians work 33.5 hours per week. But payroll earnings are rising, up +5.2% in September from a year ago. That is a faster pace than recently. The growth in average weekly earnings can reflect a range of factors, including changes in wages, composition of employment, and hours worked.
The Bank of Korea cut its base rate by -25 bps yesterday to 3.0% during its November meeting. It was a cut not expected and was the second straight month of rate reductions, bringing borrowing costs to their lowest level since October 2022.
In China, the CCP top leadership is apparently very concerned about 'social stability' risks. A top national official has been out telling local officials to strengthen “risk prevention and control at the source”. He said that “it is necessary to rely on technology for police force and combat effectiveness, deeply mine the "rich mine" of legal data, strengthen data identification, screening, analysis and evaluation, and find ways to identify and screen out potential risks". They don't want to fix the problem, rather quash it.
In Hong Kong, prices for private residences stopped falling in October. The smallest units, 40m2 and smaller, saw a +4.3% rise from September, ending a long decline that started in 2019. But those are still -7.8% lower than a year ago, and down -27% since mid 2019. The broader market is down -9.9% in the year. The interruption of the decline was due to the cancellation of some stamp duties and the opening up the market to mainland Chinese buyers
The EU sentiment surveys were broadly stable in November.
In Australia, private capital investment rose +1.1% in Q3-2023. And that was despite a -1.9% drop in the mining sector. And you can see that in the distribution by State. New South Wales led the way with a +3.6% rise followed by Victoria's +3.2% gain. The largest falls were in South Australia (-11%) and the Northern Territory (-17%). WA was down too, but a lesser -1.3%. Large building projects involving large scale upgrades in the manufacturing sector, and large data centre projects, were the drivers. Many companies in this survey say they plan an investment surge in 2025. Westpac described the trend as a "once in a generation structural change".
As part of a last-minute set of deals to get most of its agenda passed in preparation for their 2025 federal election, their government has accepted a Green Party inspired compromise to split the RBA board in two, one for rate setting, and another for governance. The Green's goal was to force the RBA to cut rates, killing the RBA's independence, but it is not clear this aspect was achieved.
Container freight rates are down another -2% last week from the week before. Outbound China to the USWC saw the largest fall, down -5% in the week. Bulk cargo rates are down -7% in a week. That now puts them -34% lower than a year ago, but a year ago was when they suddenly spiked.
The UST 10yr yield is now at just on 4.24% and unchanged from this time yesterday. The key 2-10 yield curve is still positive, but only by +1 bp. Their 1-5 curve inversion is inverted by -21 bps. And their 3 mth-10yr curve inversion is unchanged at -40 bps. The Australian 10 year bond yield starts today at 4.42% and up +2 bps. The China 10 year bond rate is unchanged at 2.06%. The NZ Government 10 year bond rate is down -6 bps from this time yesterday at 4.48% and back to where it was six weeks ago.
Wall Street is closed today for their holiday. But they will open tomorrow for some brief trading. Overnight European markets were firmish with London up +0.1% and Frankfurt up +0.8%. Tokyo ended its Thursday up +0.6%. Hong Kong however was down -1.2% and Shanghai fell -0.4%. Singapore ended up +0.8%. The ASX200 was up +0.4%. But the NZX50 fell a rather sharp -1.2%.
The price of gold will start today at US$2642/oz and virtually unchanged, down just -US$1 from this time yesterday.
Oil prices are little-changed, still just over US$68.50/bbl in the US while the international Brent price is just over US$72.50/bbl.
The Kiwi dollar starts today at 58.9 USc and down -20 bps from this time yesterday. Against the Aussie we down -30 bps at 90.6 AUc. Against the euro we unchanged at 55.8 euro cents. That all means our TWI-5 starts today at just under 68.4, and down -20 bps from yesterday.
The bitcoin price starts today at US$95,260 and down -0.8% from this time yesterday. Volatility over the past 24 hours has been modest at +/- 1.4%.
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