Here's our summary of key economic events overnight that affect New Zealand, with news the US Fed looks more trapped in policy choices than it has for a long time.
But first up today, a US-UK trade deal was announced to great fanfare. But in fact it isn't much. Rather it is a small set of carve-outs from the previous base case: Car tariffs on British-made cars would come in at 10% rather than 27.5%, steel tariffs would go to zero and the threat of future pharmaceutical tariffs would recede. The overall headline US tariff of 10% seems to still be in place; the UK has offered more market access to the US and a Boeing airplane order. But the US did not get changes on food standards or the UK's digital services taxation. The whole thing is very underwhelming. All headlines, no substance.
But the equity markets liked it, even if the bond markets didn't. The USD rose on the news. Perhaps the equity markets also see progress coming in tomorrow's Swiss meeting between China and US representatives?
Meanwhile, US jobless claims fell last week and by a bit more than seasonal factors would have assumed, coming in right at the level expected by analysts. There are now 1.846 mln people on these benefits, whereas a year ago there were 1.743 mln on them, a +5.9% rise.
American labour productivity fell -0.8 in the March 2025 quarter as output decreased -0.3% and hours worked increased +0.6%. It is their first decrease in productivity since the volatile pandemic years, and prior to that, the first Trump presidency.
March wholesale inventories rose marginally (+0.4%) but so did sales in the pre-tariff rush, so the inventory-to-sales balance was little-changed and not exhibiting any stress.
Also not changing much were American inflation expectations in April, which isn't as sanguine as it sounds because they came in at the same elevated 3.6% level they jumped to in March. However, households’ perceptions about their current financial situations deteriorated, with the share of consumers reporting that they are somewhat or much worse off compared to one year ago increasing. Similarly, households’ expectations about their future financial situations deteriorated, with the share of those believing they will be somewhat or much worse off a year from now also rising.
There was a well-supported US Treasury 30 year bond auction earlier today and that brought a median yield of 4.75%, little-changed from the 4.73% at the prior equivalent event a month ago.
In Malaysia, their central bank held its policy rate at 3% overnight, as was expected. They have low inflation, 1.4%, and a good +4.4% economic expansion but one that is fading. And they are vulnerable to the tariff war. In the meantime, Malaysian industrial production is still expanding at a healthy clip.
In Europe, German industrial production is on the come-back up +3.0% in March from February, and for the first time since May 2023, hardly lower than year-ago levels. Of course, this is data that predates the onset of the US tariff war.
In England, their central bank cut its policy rate by -25 bps to 4.25%, also as expected. But two of their nine members voted for no change. It is their fourth rate cut since August 2023, when their rate reached 5.25% in the previous cycle. They currently have a 2.6% inflation rate, slowly easing, and a +1.4% economic expansion rate.
With the Bank of England following the ECB down, along with Canada, soon Australia, and likely New Zealand, it does point out that the US Fed is now boxed in by US fiscal policy, basically unable to cut rates there because of the immediate inflation risks.
In Australia, they changed their laws making it clearer that buy-now-pay-later contracts are covered by their National Credit Code (which is Schedule 1 to their National Credit Act). ASIC has now issued regulatory guidance for the BNPL sector.
We should probably note that lithium prices have fallen further, with the bubble well and truly over, and prices back to their pre-bubble 2021 levels
The reduction impetus is going out of global container freight rate changes, down just -1% last week to be -23% lower than year-ago levels. Bulk cargo rates stopped rising in the past week.
The UST 10yr yield is at 4.37%, up +10 bps from this time yesterday. The key 2-10 yield curve is unchanged at +48 bps. Their 1-5 curve is now inverted by only -7 bps. And their 3 mth-10yr curve has turned positive at +8 bps. The Australian 10 year bond yield starts today at 4.30% and up +2 bps from yesterday. The China 10 year bond rate is unchanged at 1.64%. The NZ Government 10 year bond rate is down -3 bps at 4.49%.
Wall Street is up +1.2% in Thursday trade on the S&P500. Overnight, European markets were mixed with London down by -0.3% and Frankfurt up +1.0%. Yesterday Tokyo rose +0.4% in Thursday trade. Hong Kong was up +0.4% and Shanghai was up +0.3%. Singapore however was down -0.4%. The ASX200 ended its Thursday up +0.2% but the NZX50 finished down -0.2%.
The price of gold will start today at US$3303/oz, and down -US$81 from yesterday.
Oil prices are firmer today, up +US$1.50 at just under US$60/bbl in the US and the international Brent price is now just under US$63/bbl.
The Kiwi dollar is now at 59.1 USc, down -60 bps from yesterday at this time, down a full -1c from Wednesday. Against the Aussie we are down -20 bps at 92.3 AUc. Against the euro we are unchanged at 52.6 euro cents. That all means our TWI-5 starts today just on 67.6 and down another -20 bps.
The bitcoin price starts today at US$101,054 and up +4.6% from yesterday. Volatility over the past 24 hours has been moderate at just under +/- 3.0%.
Daily exchange rates
Select chart tabs
The easiest place to stay up with event risk is by following our Economic Calendar here ».
38 Comments
Go weld, young man.
"Dan Schnaufer who works as the service and body shop director at the nearby D’Addario Automotive Group, said, "The idea of growing your own talent has gotten more critical in recent years, when you have fewer and fewer people going into this industry." Those fresh out of high school can get around $50,000 per year and make around six figures within five years.
At Father Judge, the 24 seniors graduating from the welding program in 2025 all have job offers lined up, starting at $50,000 per year, welding instructor Joe Williams said. Employers are increasingly reaching out to him every semester."
https://thepostmillennial.com/us-companies-offer-high-school-juniors-70…
Took me 2 degrees and around 4 years in a corporate office environment to work out the better fields were agriculture and construction. Too much bullshit, and too much competition in many of our desk bound jobs (with some exceptions obviously)
Prof G outlines a plan for young dudes pretty well
- pick a trade job with 90% market uptime (i.e. the industry is busier than not)
- be in the top 10% of performers
- as your skills and acumen develop, so will your passion for it.
I'd urge any young person to look out there at industries, specifically ones with an aging workforce and target that, in 5-10 years you should crush it.
What's your advice to the 90% who cannot be in the 'top 10%'?
Be in the 80-90% of course.
Get better or find something else to do?
The bar is pretty low. Turn up regularly, put some care and attention in your work. Those who can't do that, will get paid "ok", but the better performers get rewarded pretty well.
There is much to recommend it as long as you are aware that a work life on the tools is likely to be considerably shorter than one not...and plan accordingly.
Work life in the office or corporate wears them out too. Often called burnout.
But seriously in discussion about retirement many corporate workers need to as much as physical workers. They hit the wall too.
The life of a tradesperson used to be shorter due to high exposure to containinants. And maybe the extra curricular lifestyles they used to engage in (heaps of piss and ciggies). But if you're semi sensible you can expect to live as long as anyone else.
You've about as much risk of a bung shoulder using a keyboard and mouse every day for 40 years though.
And that is what you believe?
It's what I know from having to contend with health and safety data for decades.
Feel free to convince me otherwise, or define what a "considerably shorter" life is.
Considerably shorter 'work life' (in the occupation) was the observation.
To contrast your 'having to deal with health and safety data for decades" I will offer decades of (personal) work in various fields as an employee, contractor and sole trader backed by observation and discussion with those also directly involved in the requirements of employment in those hands on positions.
It is not a pissing contest of who's job is more demanding simply the reality that older bodies are less capable of meeting the physical requirements that these positions demand....always being aware that there are outliers that can be pointed to as examples of exception, but closer examination will usually find that there are productivity costs associated.
Ah, so by anecdote. On the site I went to today:
One person early 20s
Two people middle aged
Three guys post retirement age
And then with the productivity, less able people with decades under their belt, still surprisingly as or more productive than someone younger. The experience often balances our virility.
How good is a 60 year old clerical worker at becoming a coder?
As expected the 'anecdote' claim arrived....the same claim can be apportioned to your H&S 'data' which was strangely missing.
Oh well, sounds like we have each other pegged then.
What should someone do Frank? The only takeaway I get from your posts is everything sucks.
The life may be a big call, but the joints and quality of life is another. As an example only using shoulders: https://pmc.ncbi.nlm.nih.gov/articles/PMC8567712/
The direction of estimates by type of occupation
The prevalence of shoulder pain generally increased past the age of 50, with 16 of the 21 included studies reporting higher estimates in older participants. As shown below, the majority of the studies investigating physically active occupations reported shoulder pain prevalence to be higher over the age of 50. Whereas this was less common in those reporting on sedentary occupations.
There was a total of 37,845 participants in 18 studies reporting on physically active workers. The prevalence estimates or odds ratios in those over 50 increased in 14 of these 18 studies [13, 14, 21, 23, 25, 29–31, 34–39], remained stable in two [22, 28] and decreased in one [24]. One study of farmers reported data only for two age groups, using 65 as a cut point and found that shoulder pain reporting decreased in the older group [33]. The prevalence estimates for all studies stratified by age are shown in Table 2.
There was a total of 2642 participants in the four studies reporting on sedentary occupations. Two of these studies had prevalence estimates that continued to increase in people over the age of 50 [26, 32] whereas they decreased in two [27, 35].
So we can deduce at least that while 50% of the studies of sedentary occupations (noting significantly lower participants for the purpose of the review) had increased shoulder pain post age 50, however 14 of 18 studies or approx 77.7% of studies for the review of physically active occupations had increased prevalence of shoulder pain post 50.
Don't underestimate the mental and physical decline associated with non physical work. Mentally sedentary work can literally do you head in!
My view is you just cant sperate the two and say one is worse than other. Not that simple.
I'd agree. There's pros and cons with both.
But it's hard to argue with the earning potentials of a sector that has a shortage of labour, vs work that can be done by almost anyone, anywhere.
Agreed, there's usually plenty of downsides physically to sedentary work also. It is unnatural for humans to be sedentary for most of the daylight hours, having to willingly force exercise and movement into their lives as if it were an abnormal outlier. Goes against our nature, but we live in a world of convenience now sadly. Either way, these discussions are interesting nonetheless and it is good to hear varying perspectives on the subject.
For me, working in an office, there was just no sense of completion.
"Hey look, another email"
That and it's a lot more transparent whether someone accomplished something worthwhile or not.
The corporate workers are just as buggered. Just in different ways.
I'm waiting to hear about the way of life that is free from peril and concern.
The closest I've managed is when life runs you over, dust yourself off, move on, and don't look back.
Don't blame Trump for reduced 'productivity' - and it isn't 'labour'.
Trump is the facilitator (there would have been another if not this one) of pent-up pressure.
And labour vs fossil energy, is mere noise. A better metric is energy-efficiency per output achieved. And complexity is demanding more of the energy (think: AI) than ever before, a Catch 22. Add in entropy (maintenance required to parry decay) and 'productivity' was always going to peak, plateau, then decline.
Which is why the future will not resemble the past
I can get close to living self sufficiently off the land
My energy is still much more efficiently used engaging in wider commerce
Short of total collapse, that's unlikely to change anytime soon
"I can get close to living self sufficiently off the land"
Remove even a couple of the current 'complex systems' that enable that 'getting close' and the whole house of cards collapses.
Are you talking about global thermonuclear war, or just things like cheap fertilizers.
Trump the facilitator? Maybe but would wager he wasn’t exactly elected to facilitate whatever it is that he is facilitating. Trump is President because the Republican Party eyed him as the best prospect to win the presidency and resultantly provide the power, the positions and the associated riches all the way down the line. Turn the tap on for the troughs for all the snouts. Call me cynical but in my view that is the base for just how base government in the USA is.
It would have been something else - the physics is inexorable. Sure, we won't have the real conversation - we'll otherise others, blame this, blame that - but it was the malaise spreading not just up the lower echelons, but well up into the 'middle class', which voted for disruption not once, but twice.
On another note, I presented to the DCC yesterday and included my presentation to them 10 years prior. Coverage by the local media (ODT) of both submissions, and their implications?
Nil. Which I regard as having the same effect on their readership, as lying to them outright. And they have been prodded, believe me.
Where does the physics argument begin, and the "global power structures have a habit of moving around" observable phenomenon for hundreds, if not thousands of years end?
And how does one distinguish one from the other.
Like, maybe the prophecy is right and the whole shooting match comes down.
But maybe, it's not (or it's out by decades or centuries), and then we have a whole host of other dynamics to also be looking at.
You seem to want to totally discount any discussion of the latter. Fairly limited.
Energy, work, leverage, resources, and the exponential function (which eliminates your 'decades or centuries'). Plotted forward, we boil the oceans in 400 years. Won't happen (we'd die out well before) but assuming anything exponential will go any time, is flawed thinking.
Say we wanted to talk about India and Pakistan
Is there any use talking about flawed lines drawn on maps, historic rivalries promoted by a colonial power to create disharmony within the population instead of towards the occupier, etc?
Or is that a subject we can only appraise using your paradigm?
What if someone wanted to start a business? Is the only answer "don't bother, my charts say everything is going to zero"?
Bro forgot to plug in the fertility rate. NZ's current birth rate (1.54) has us on track to have a 60% lower population by 2100 and 70% lower by 2125. Are all of these geriatrics going to have 256 refrigerators and 1024 cars? Who is exactly is going to be using all of this energy and resource? Or do geriatrics have infinite lifestyles motorheads can only dream of?
"No nation that has had its TFR drop below 2.0 has ever seen it rise back above 2.0.
Assuming the continuation of the current trajectory of our fertility and mortality (and even with some variation), the exponential population growth of the mid-20th century (doubling time of 37 years) is about to flip to an asymptotic decline, with the population halving every about 40 years."
https://insightplus.mja.com.au/2024/8/health-care-in-for-a-roller-coast…
https://www.reuters.com/world/china/chinas-population-falls-third-conse…
Well yes concede it is conceivable that in the great morass of the USA electorate there is a thickening thread of awareness that great change is necessary but suggest it would be difficult to pinpoint it at street level where Americans tend to not consider much beyond their own backyard. But true, the lord does move in mysterious ways.
Amusing to hear on RadioNZ the use of the reduced input from those impacted “improved” resource management act and a new McD’s on Kepa Road. If you vote for a lack of consultation, don’t complain when you are barred from input. What are the chances of a political party enhancing local power? 0 to none?
Donella Meadows taught Systems thinking - one of the original MIT group.
https://en.wikipedia.org/wiki/Thinking_In_Systems%3A_A_Primer
She pointed out that Systems do what they are designed to do, until they can't (usually a feed-back-System reverses). And that the dominant System will subsume all others in an attempt to continue. This is what we are watching now - global growth (real) is in the rearview mirror, but the dominant pursuit of it will gobble up all else in a (doomed) attempt to continue. Local governance is included in that, obviously.
Commandeering of all remaining commons - plus removal/commandeering of science, removal of rules - is inevitable. But it won't/can't produce another 'doubling time'. Or even a portion of one. So, the pursuit of growth, ceases - near term.
The only question is: What comes after?
Professor MacCulloch won't be making any friends in the big end of town atm
Big?
Lots of people should re-examine their allegiances; slater than some folk think
Politics is a dirty game. Isn’t it Iraq where, when this Minister addresses people, they take off their shoes and throw them at her? I am happy to cast my 👞
Anything to get property out of the doldrums eh! So whilst I hold the view the bottom is a way off, the likelihood is that the rules are altered to try and make it not happen.
We welcome your comments below. If you are not already registered, please register to comment.
Remember we welcome robust, respectful and insightful debate. We don't welcome abusive or defamatory comments and will de-register those repeatedly making such comments. Our current comment policy is here.