US jobless claims stay up; US PPI rises much more than expected; China mulls housing buyout; India credit rating upgraded; Australian employment rises; UST 10yr at 4.29%; gold soft and oil rises; NZ$1 = 59.1 USc; TWI-5 = 66.9

Here's our summary of key economic events overnight that affect New Zealand, with news tariff-costs seem to be having much more impact on US prices than on global trade.

But first, US initial jobless claims rose slightly last week to 199,000 but that was slightly lower than seasonal factors would have accounted for. There are now just over 2 mln people on these benefits, +100,000 more than at the same time last year.

However, rising much more were producer prices. They are up +3.3% in July from a year ago, a jump from June's +2.4% and much higher than the expected +2.5%. This ends a period where these costs eased since February with a notable reversal. The month-on-month rise was outsized and we make that the largest non-pandemic jump since 2012. This data is having traders re-think their bets on the September 18 US Fed rate review. Currently they expect a -25 bps cut, despite White House pressures. They have two more -25 bps cuts priced in through to january 2026, so maybe some of those could get reassessed. Today's PPI data may signal the tariff-induced inflation is only just starting.

In China, they are wrestling - endlessly it seems - with how to staunch the property development sector's bleeding. The latest idea is that Beijing's SOEs buy up the unsold housing overhang.

India's exports rose in July, but their imports jumped much more so their trade deficit worsened and is much more negative than it was a year ago for the same month.

Meanwhile, S&P have upgraded the Indian sovereign credit rating to 'BBB' from 'BBB-' and changed the outlook to stable from positive. It said the upgrade was based on economic resilience and sustained fiscal consolidation. They noted the strong growth momentum, said monetary policy was credible, and added that the impact of Trump’s tariffs should be manageable.

In Australia, one of their largest superannuation funds failed to tell regulator ASIC about investigations into serious member services issues, including incorrect insurance premium refunds for dead members. This is part of what ASIC is alleging in an Australian Federal Court suit launched yesterday.

And staying in Australia, their jobless rate eased to 4.2% in July, down from the four year high of 4.3% in June. The decline was driven by a drop of 10,200 in the number of unemployed, bringing the total to 649,600. Meanwhile, employment rose by +24,500 to a record high of 14.6 mln following a downwardly revised gain of +1,000 in June. Full-time employment rose by +60,500 while part-time positions fell by -35,900. Female participation hit a record high of 63.5%.

Global container freight rates fell in a broad shift lower to be down -3% last week from the prior week and down -59% from year ago levels. Those year ago levels were an unusually high benchmark due to Red Sea security factors back then. Bulk freight rates were little-changed over the past week, but are +20% above year ago levels.

The UST 10yr yield is now at 4.28%, up +5 bps from yesterday at this time. The key 2-10 yield curve is holding at +55 bps. Their 1-5 curve is still inverted by -10 bps. And their 3 mth-10yr curve is now inverted by -3 bps. The Australian 10 year bond yield starts today at 4.24% and up +4 bps. The China 10 year bond rate is unchanged at 1.73%. The NZ Government 10 year bond rate starts today at just on 4.43% and again unchanged.

Wall Street is marginally softer in Thursday trade and just off its record, held up by rate cut prospects. Overnight European markets were generally up +0.8%, except London which ended up just +0.1%. Tokyo ended its Thursday session down -1.4%. Hong Kong slipped -0.4% and Shanghai was down -0.5%. Singapore also fell, by -0.4%. The ASX200 ended its Thursday session up +0.5%. And the NZX50 matched that with its own +0.5% rise.

The price of gold will start today at US$3,335/oz, down -US$17 from yesterday.

American oil prices have risen +US$1.50 to be just under US$64/bbl with the international Brent price up a bit less at US$66.50/bbl.

The Kiwi dollar is at just under 59.1 USc and down -60 bps from yesterday. Against the Aussie we are down -20 bps at 91.1 AUc. Against the euro we are down -20 bps at 50.8 euro cents. That all means our TWI-5 starts today at just on 66.9, down -40 bps from yesterday.

The bitcoin price starts today at US$117,741 and down -3.1% from this time yesterday. Volatility over the past 24 hours has been moderate at +/-2.6%.

The easiest place to stay up with event risk is by following our Economic Calendar here ».