Here's our summary of key economic events overnight that affect New Zealand, with news Canada has conceded it has lost its dairy dispute with New Zealand.
But first in the US, actual initial jobless claims rose sharply to 261,000 from the previous week but that was less than seasonal factors would have suggested. There are now 2,017,000 people on these benefits, +4% more than year ago levels and the most in four months.
After three down months, the Philly Fed factory survey recovered in July. New order intakes rose. But also rising was the prices firms paid for their inputs and what they charged their customers. 'Safe' behind a tariff wall, these firms are showing the expected reactions, ones that will make them internationally uncompetitive.
Also rising were US retail sales in June. This also came after two retreating months, and was not expected. Year on year these sales are up +3.7% of which car sales rose +5.3%. Other than vehicles, the rise was +3.3% and still quite positive. However 2.7% of that can be accounted for by CPI inflation.
US factory activity and retail sales may be rising but business inventories are not. And that is a resilient sign.
One sector not showing any resilience is their house-building sector. The NAHB sentiment survey shows it remains at a low ebb, down near its 2022 lows. Affordability issues remain at the heart of the sector's woes, and they are hardly likely to improve as tariff-taxes flow through.
In Canada, they have quietly conceded they have lost their dairy access dispute with New Zealand and will now honour the CPTPP treaty agreements. Although the US is not party to this dispute, the MFN clauses in its USMCA Agreement probably means wider access for others to the Canadian dairy market.
Across the Pacific and continuing its yoyo pattern, Singapore's June exports jumped. In fact they rose +14.3% from May to be +13% higher than year-ago levels.
In Australia, their June labour market softened. They were expecting a jobs gain of +20,000 but only got +2,000. Their jobless rate ticked up to 4.3%. As a result, financial market pricing for an RBA rate cut on August 12 have risen.
And inflation expectations in Australia are staying stubbornly high - although not as high in July as they were in June. The Melbourne Institute's Survey of Consumer Inflationary and Wage Expectations came in with inflation expectations at 4.7% which was down from June's 5.0% but apart from that still its highest since mid 2023. Expected wage growth fell slightly in July and remains relatively weak.
A softening labour market but very high inflation expectations (and a frothy real estate market), will all make the RBA's assessments very difficult.
More globally, container freight rates fell -2.6% last week from the prior week to be -55% lower than year-ago levels. But those year-ago levels were unusually boosted by Red Sea tensions. Currently, outbound rates from China are the weak spots in this market. Bulk cargo rates rose a sharp +34% last week to be back to year-ago levels. To be fair these current overall levels are basically 'average' over the past 35 years (so in inflation-adjusted terms they are very low).
The UST 10yr yield is now at 4.47%, little-changed from yesterday at this time. The key 2-10 yield curve is now up at +54 bps. But their 1-5 curve is still inverted by -11 bp. And their 3 mth-10yr curve now +15 bps positive. The Australian 10 year bond yield starts today at 4.34% and down -4 bps from yesterday. The China 10 year bond rate is little-changed today at 1.66%. The NZ Government 10 year bond rate starts today at just under 4.62% and unchanged.
Wall Street is firmer today with the S&P500 up +0.6%, enough to claim a new record high. Good corporate earnings are driving the mood. European markets were all much higher with Paris and Frankfurt up about +1.4% and London up +0.5%. Tokyo ended its Thursday session up +0.6%. Hong Kong was down -0.1% but Shanghai rose +0.4%. Singapore ended up +0.7%. The ASX200 closed on Thursday up +0.9% and the NZX50 rose +1.2% for the best regional showing.
The price of gold will start today at US$3,336/oz, down -US$18 from yesterday at this time.
American oil prices are up +US$1 at US$67.50/bbl while the international Brent price is now just under US$69.50/bbl.
The Kiwi dollar is now at 59.3 USc and down -25 bps from this time yesterday. Against the Aussie we are up +30 bps at 91.4 AUc. Against the euro we are also up +10 bps at 51.2 euro cents. That all means our TWI-5 starts today at just on 67.2, and unchanged.
The bitcoin price starts today at US$119,100 and essentially unchanged from this time yesterday. Volatility over the past 24 hours has remained modest, at just on +/-1.1%.
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6 Comments
6 months in and 42 to go and the uncertainty and confusion of Trump’s presidency is now compounded by health concerns, rebounding conspiracy theories and an economy that so far is hardly making people better off as he promised. It is no vocation for old men. For instance, Reagan commencing his second term at 73 was contentious and the fading that became noticeable, soon became dire after he left office. Biden’s decline of course even more stark. There is no succession option for Trump on the table. Only he can carry the can and hold at bay the repercussions he is hell bent on raising.
"...when the age is in, the wit is out."
Shakespeare
"There is no succession option for Trump on the table."
How so?
The replacement, Vice-President JD Vance, is arguably every bit as potentially lethal and destructive as Trump.
And then Scott Bessent, Secretary of the Treasury, and Howard Lutnick, Secretary of Commerce, are both farcically incompetent, appointed, and sycophantic Trump cheer-leaders too.
Bessent is as dodgy as they come, with his George Soros connection, and Lutnick from Cantor Fitzgerald, a Fed primary dealer firm, is the Wall Street shill connection.
They have all of these lunatics in place, poised to heist the most obscene wealth transfer from the working class to the new techno-feudalist kleptocracy in financial history.
If they continue on the current trajectory, they will bring down not just the US economy, but much of the global economy with it.
The only thing that stands in their way is the BRICS multipolar alternative, and they are obsessed with destroying that too.
The succession might happen very soon - Trump's position is becoming more untenable by the day as his rank and file desert him over his raft of broken promises, and even stalwart supporters like Tucker Carlson turn on him regarding the Epstein debacle, and in highlighting just how wide the MAGA multi-splintering is in progress.
So too the global disgust with how Trump has handled both the Palestinian and Ukraine debacles, plus the fact that he now owns both of these wars - now his admin is overtly signalling their intention to begin a military war with China as well.
Apparently two potential nuclear wars being stoked (Israel and Ukraine) is not enough - these lunatics want to start one with China as well.
Add in the fact that both Trump's physical and mental decline are now in obvious freefall, and he could well be gone in no time.
There is a single precedent for a resignation of a POTUS - Nixon, who resigned when his position became untenable.
Albeit, it was only for minuscule reasons, compared to the domestic and global trail of carnage to security, social stability, diplomacy, and financial stability caused by the Trump Admin - and all in this brief second term, seven months in office.
https://globalsouth.co/2025/07/16/larry-wilkerson-with-nima-trumps-50-d…
Don’t disagree with the sentiment but the point is none of those characters are equipped to hold the whole damn shooting box together in the form of Trump. Trump is currently unto America as Napoleon was to France, as Tito was to Yugoslavia. Whatever and wherever Trump’s support is, it won’t simply transition to any replacement and what is presently being battened down won’t stay battened down for long and that includes the infighting and pent up ambitions in the Republican party itself.
I agree, Foxglove.
In fact, I have thought all along that Trump's reason for coveting the POTUS role is for narcissistic self-aggrandisement anyway, and of course, as a tool for accumulating truly obscene family wealth along the way.
He is far too thick to have any grander plan than that, and that was why he is to be used as a gourmless patsy - one that could be thrown under the bus, as the real puppet-masters like Thiel and Ellison work through their techno-feudalist central control, and wealth transfer heist.
Cheers
Col
Caused me there a bit of a flash back. 1960s, King Rat the movie.
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