Here's our summary of key economic events overnight that affect New Zealand, with news the US and China are meeting in London to discuss China's block on exports of rare earth minerals that the US manufacturing sector needs. The hope is that the settlement will have the US pull back from its tariff-tax war. More likely, it will be a trade of US AI chips for Chinese rare earth minerals.
In the background, the dismantling of civil society and the rule of law continues in the US, but you will have to get news of those overnight events elsewhere - even though they will have a corrosive impact on commerce.
Our first item in the US is that consumer inflation expectations fell back in June to 3.2% for the year ahead, which wasn't what was expected. But a look at the components explains why. It was driven by the expectation that petrol prices will drop - on a weakening economy. On the other hand those surveyed expected food prices to rise to 5.5% which is a two year high, rents by 8.4%. The expectation that their jobless rate will rise remained high.
And we should probably point out that analysts are noting that the UST 10 year yield (4.5%) is now well above the US nominal GDP growth rate (3.8%) for the first time since 2011, and that is seen as a signal that corporate insolvencies will now rise noticeably after a long period of relative stability.
China said its CPI price change held at -0.1% of deflation. That is the third month in a row it has reported that, the fourth recording deflation. It does seem odd, and a tad unlikely, that Chinese consumer prices are consistently deflating at such a low level. Anecdotal observations talk of 'raging price wars'. According to the official data these are having zero impact. Year-on-year they say beef prices are down -0.1%, lamb prices are down -2.8% and milk prices are -1.5% lower. But beef prices did rise in May from April, according to this data.
Meanwhile Chinese producer prices deflated more, down -3.3% from a year ago to their fastest rate of decline since July 2023.
And China booked another bumper trade surplus in May. Exports rose +4.8% (about what was expected but historically low), while imports fell -3.4% and far more than expected. They benefited from the TACO trade in May. Their surplus with the US was +US$18 bln for the month although they did export less and import more. To New Zealand, they exported -3% less but imported +11% more, so our surplus rose. To Australia, their exports were little-changed but they imported almost -19% less in May.
In Taiwan, they far outshone their neighbour and rival with a huge rise in exports (a new record high) and a large rise in imports from the same month a year ago. That contributed to a trade surplus of +US$12.6 bln in the month, now one eighth that of China even though their economy is only one twentieth as large.
The UST 10yr yield is now at 4.49%, and down -2 bps from this time yesterday. The key 2-10 yield curve is still at +48 bps. Their 1-5 curve is inverted by -7 bps. And their 3 mth-10yr curve less positive at +23 bps. The Australian 10 year bond yield starts today at 4.32% and up +5 bps from yesterday at this time. The China 10 year bond rate is holding at 1.69%. The NZ Government 10 year bond rate starts today at 4.65% and up +2 bps.
Wall Street is up +0.3% in its Monday session of the S&P500. However, European markets slipped about -0.3% on average. Tokyo ended yesterday up +0.9%, Hong Kong was up +1.6% and Shanghai ended up +0.4%. Singapore ended up only +0.1% however. The ASX200 was closed for a public holiday. But the NZX50 ended its Monday session down -0.2% and never really got going.
The price of gold will start today at US$3,334/oz, and up +US$26 from yesterday.
American oil prices are firmish, up +50 USc at just on US$65/bbl while the international Brent price is just under US$67/bbl.
The Kiwi dollar is now at 60.5 USc, and up +30 bps from yesterday at this time. Against the Aussie we are up +10 bps at 92.8 AUc. Against the euro we are up +20 bps at 53 euro cents. That all means our TWI-5 starts today at over 68.4 and up +20 bps from yesterday.
The bitcoin price starts today at US$108,312 and up +1.9% from yesterday. Volatility over the past 24 hours has been modest at just on +/-1.4%.
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32 Comments
While gold has done very well and is always mentioned here....Silver is the poor mans gold.
DC, perhaps a mention on Silvers/AG meteoric rise from now? upto you, but an emerging, big story.
Silver Continuous Contract Futures Prices and News | SI00
It's just broken USD$37.00 and is now going parabolic imho. It still way below the historic Gold/Silver correlation average (the GSR) and its still with a lot of value catchup, for the mighty AG.
So Phoenix/JCs hit picks of ASX listed Aussie Silver Miners, will be on yet another, big run, this week.
(Sorry, NZ Housing Ponzi, Wet, Soggy Bagholders.....you backed the wrong horse since 2021 and the ensuing NZ housing crash. Still time to turn the page on the dying NZ Housing Ponzi. 2024 CVs all negative and we will have the 2027 CVs negative as well, I believe:) - what a great time to be alive!
Perhaps invest in some safer alternatives, as opined here very often, by learned authors - such as a very productive business, with unique selling propositions)
Thanks for sharing thoughts - been looking for options,
So Phoenix/JCs hit picks of ASX listed Aussie Silver Miners, will be on yet another, big run, this week.
I don't recommend anything. Just things I watch. Silver mining is tricky so I would say stick to the big guns and / or ETFs if you're not an expert.
By the way, the all-time high price of silver in USD was approximately $49.45 per troy ounce in January 1980.
However, we have already hit ATH prices in JPY, AUD, CAD, Kiwi peso.
2015-2019 was optimal time to take positions in silver relative to Kiwi peso - returning approx 200%+.
Yes each must asses their own risks, own purchases, but I have long looked/traded the same options you listed.
They will be very volatile as Ag cracks US$40 and onwards imho.
Many will raise into any run, amping the risks.
This was the Hunt Brothers trying to corner the silver market. Ended spectacularly bad for them. Grannies were lining up to sell their silver plates.
https://en.wikipedia.org/wiki/Silver_Thursday
More recently in the last 2-3 years Mr. Gamestop was also punting silver. Be wary at these prices. People tending to push prices at these levels are likely to have come in late and want the silver price to go up further so they can get out at a profit.
Gee, this is an interesting fiscal comparison;
As reported in March last year, the tax giveaway to landlords is estimated to cost the country $2.9 billion. To put this in perspective, that is more than the amount paid in Treaty settlements since 1985, which is about $2.7b. In other words, in one year, the current Government awarded landlords more money than has been paid out to Māori in 40 years as compensation for historical wrongs.
https://newsroom.co.nz/2025/06/08/lets-call-taxing-the-rich-what-it-rea…
you can rely on academics & the MSM to reliably compare apples & oranges so as to make a case for pineapples
Kknz with fingers in their ears. Lalalalalalala
You just realised this Kate?
Total tiriti settlement is around 0.7% of 1 years GDP. If you only count cash, and not the return of council nature strips and roundabouts (yes, we were really offered a rounabout), it would be <0.5%.
Lol. A roundabout. Tbf that would seem extremely appropriate given the process you went through.
Does that include the right to cheap land purchase? And does it include ransoms for resource approvals? eg. The $100k extracted recently from electricity companies.
You are one roundabout up on what most of us in NZ have been offered.
Most of us are not the landed gentry or benefitted from land settlements of old.
Unfortunately many lump us all into that basket.
Gee, this is an interesting fiscal comparison;
Property is the largest asset class for half of New Zealand’s top 10 iwi, according to the 2024 TDB Advisory Iwi Investment Report, with capital allocations valued in the billions. The 10 largest iwi collectively control assets worth around $8.2 billion, with property portfolios often concentrated in their traditional rohe. For example, Ngāti Whātua Ōrākei holds 97% of its assets in property, Ngāti Toa 77%, and Waikato-Tainui 66%.Ngāi Tahu, the largest iwi by assets, has 39% of its $2.2 billion portfolio in property, including residential, commercial, and rental developments.
To be fair, it was not a giveaway - it was a take less off them-away.
I am of the school that interest deductions are a legitimate business expense. I believe this to be the rule and not the exception. Some more tax knowledgeable person could throw some light on this.
interesting article in Newsweek worth reading;
https://www.newsweek.com/peter-turchin-political-violence-donald-trump-…
In the last paragraph, a comment made me smile; "America was in a 'revolutionary situation,' which could be resolved by either developing into a full-blown revolution, or by being defused by skillful actions of the governing elites. Well, now we know which way it went."
This academic was simply objectively expressing what the evidence stated to counter the deniers. Interesting that people expect the elites to suddenly grow a brain cell that recognised they were their own biggest threat to their position in society and suddenly change their ways to improve the lot of every one in their 'democracy'. I use the term 'democracy' advisably as the elites have systematically undermined the powers and right of ordinary people to entrench and enrich their own positions. While this melt down is happening in the US it can and will occur here too unless something changes.
My CV dropped from $1,550,000 to $1,125,000... Mangere Bridge area
But the question is will your rates go down?
What are the odds?
No, they just wont go up as much as the average increase
Nope.
Overall, rates will outpace 'inflation' from here on it.
How rates are divvied-up, is a subsequent issue.
LGs are into triage territory - and it will get worse, not better. For reasons I have mentioned, once or twice...
But but but, the Media told is just and Itsy bitsy -9% drop......"nothing see here" says the OneWoofs
Mine looks totally effed up to buggery.....value of improvements skyrocketed (BS) . Land value collapsed (kinda fair enough). I am taking Auck council to court!
THIS IS WHAT AUCK COUNCIL ARE SOOO CONCERNED ABOUT - NO ONE HAPPY AND LITIGATION ON ROIDS......
House I sold for 19 % over cv has fallen by 25%…. Ouch
Interesting reading on the "new CVs out today" thread on r/Auckland. A lot of people wanting to review. They'll just end up paying more rates. Quite a few hefty falls in there.
If they are wanting to flick it and you want the highest CV as possible.
Correct but a number in there just want their value up as that's what they think their house is worth. Not worth doing unless, like you say, they're wanting to sell.
It's simple. They're not accurate.
Also, they're accurate.
I think they're dancing on the head of a pin
"The rating valuations Auckland property owners receive this week are based on property market trends and recent sales activity as of 1 May 2024. Therefore, these valuations are not intended to accurately reflect current market value.
Instead, the information will help enable rates to be fairly shared across Auckland’s 630,000 properties.
The new rating valuations have been prepared by two independent valuation providers, QV and Opteon. Their experienced property valuers have worked closely with Auckland Council to deliver valuations that meet robust standards."
You mean that they’re accurately inaccurate?
LOL. You don't take anyone to court - you simply use the objection form on the council website;
https://www.aucklandcouncil.govt.nz/property-rates-valuations/our-valua…
I've successfully done it twice - once to lower a valuation and once to raise it. The important thing to put together in evidence is a simple spreadsheet showing that your valuation is at significant variance to other properties in the general vicinity of yours.
If you think you have made improvements to your property that are not reflected in the new valuation - state what those are and normally the council will send a valuer to have a look at them. Bearing in mind, if any of those improvements required Building Consent - the value of the improvements would have been a part of the consent document - and so normally a council (once CoC is issued) will add those costs to the VI component of your properties valuation automatically.
Sometimes, they miss out on that step - so it pays to check.
Thanks Kate, just taking it to the court of public opinion here.....firstly.
Your advice is good and yes every objection, has a level if risk.
I think its QV you need to take to court. There is a disputes process with QV.
My CV has gone up, must be a good investment...
TUI classic Nifty:)
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