Here's our summary of key economic events overnight that affect New Zealand, with news the good bits which seem to dominate today are in fact masking some some less-than-good trends nested within them.
First up, US ADP employment report on private payrolls for October reported a +42,000 rise in filled jobs, much better than the -29,000 shedding in September and also better than the expected +25,000 gain observers had thought. They also reported that pay growth has been largely flat for more than a year. However the October jobs gains are all concentrated in California and the other two Pacific states. Without their +37,000 gain, things would look rather somber - which is what the rest of the country faces. This survey does not cover public sector employees and of course that is currently very negative given Trump's shutdown.
And we should note that this Federal government shutdown is now the longest in US history, and now longer than his first 2018-19 one.
And we should also note that oral arguments are being heard in the US Supreme Court's review of the legality of the Trump tariffs. Given the stacked nature of the court, no-one really expects them to rule the Trump actions as 'illegal', but there was a surprising amount of sceptical questioning around the legal basis earlier today.
US mortgage applications fell -1.9% last week from the prior week, the fifth decrease in the past six weeks.
In a notable contrast to the weak factory sector, the giant American services sector expanded faster in October according to the ISM services PMI. It rose more than expected to its best level since February, putting its September stall behind it. But forward looking sentiment isn't strong, with these firms still contracting workforce levels, and frustration at the level of tariff-taxes they have to bear.
Meanwhile, American household debt rose by +US$197 bln in Q3-2025 from the prior quarter to a new record high of almost US$$18.6 tln and up +4.4% from a year earlier. Mortgage balances grew by +US$137 bln and credit card balances rose by US$$24 bln in the quarter. These shifts are being considered 'steady' rather than indicating added risk.
Across the Pacific in China, the private S&P Global services PMI has remained modestly expansionary in October, and still better than the official version. The sector continues supported by a faster rise in overall new business, although export sales fell modestly. Meanwhile, 'efficiency' drives led to staffing levels reducing in part due to cost concerns. Despite higher input prices, output charges fell fractionally, while business confidence regarding the year ahead softened.
In Europe, Germany reported a rise in factory orders in September from the prior month, however that still leaves than -4.4% lower than year-ago levels. They will be encouraged by the recent uptick, which was better than expected. The new order uptick in the car, electrical and transportation sectors were particularly encouraging.
Sweden’s central bank kept its policy rate unchanged at 1.75% at its October meeting, as widely anticipated. Tonight the Norwegians will review their 4% rate too, and they aren't expected to make any changes either.
The UST 10yr yield is now at 4.15%, up +7 bps from yesterday at this time. The key 2-10 yield curve is now at +53 bps. Their 1-5 curve is now +5 bps positive and the 3 mth-10yr curve is now +23 bps positive. The China 10 year bond rate is unchanged at 1.74%. The Australian 10 year bond yield starts today at 4.36%, up +5 bps from yesterday. The NZ Government 10 year bond rate starts today at just under 4.12%, down -2 bps from yesterday.
Wall Street has started its Wednesday with the S&P500 up +0.8% and a partial recovery. Overnight, European markets were all positive between London's +0.6% and Paris's +0.2%. Tokyo was down another sharpish -2.5% yesterday. Hong Kong dipped -0.1% but Shanghai was up +0.2%. Singapore ended its Wednesday session down -0.1%. The ASX200 also ended down -0.1%, but the NZX50 firmed +0.1%.
The price of gold will start today at US$3982/oz, up +US$14 from this time yesterday.
American oil prices are -50 USc lower from yesterday at just under US$60/bbl, with the international Brent price now just under US$64/bbl.
The Kiwi dollar is now at just under 56.6 USc, and down -10 bps from yesterday. Against the Aussie we are down -20 bps at 87 AUc. Against the euro we are unchanged at 49.3 euro cents. That all means our TWI-5 starts today at just under 61.3 and only marginally softer from yesterday.
The bitcoin price starts today at US$103,811 and recovering +1.1% from this time yesterday. Volatility over the past 24 hours has been moderate at just on +/- 2.2%.
Daily exchange rates
Select chart tabs
The easiest place to stay up with event risk is by following our Economic Calendar here ».
22 Comments
While the latest round of elections will not change the seating in the houses of government in the US, the massive swing away from Republican candidates will create some interest in what Trump's response will be. Next year's elections will be the area of concern where control of the government may change. Will the chaos continue, or will push back constrain him?
According to Trump's panicked post after the results came in, looks like voter suppression is on the menu.
"Pass Voter Reform, Voter ID, No Mail-In Ballots. Save our Supreme Court from “Packing,” No Two State addition, etc. TERMINATE THE FILIBUSTER!!!"
Michael Burry bets USD1.1B to short AI
https://www.stuff.co.nz/world-news/360875884/big-short-trader-makes-bet…
It would be interesting to hear his rationale. Chip manufacturers won't be too much impacted although demand will change. The data centres however which use AI to support software as a service using AI will be. Share prices have huge emotional quotients anyway. AI is already being proven in specialist applications. Where that takes us though is anyone's guess.
Just like with the onset of mass Internet usage, there will be a delay between the expectations of investors and a path to substantive, widespread economic benefit. And in the meantime, there will be swathes of half baked firms that crash and burn.
Most people would be better served trying to work out how AI can increase the value of their time instead of betting on industry winners.
lets hope it goes better then my Black Cap wager...
Thoughts and prayers IT. I thought a blackcaps win was a sure thing too
Ahaaa hahaha 😆 remember I said I quit sport betting while I was ahead. For the GGs this week we scored a winner which largely paid for the day
I guess the losses make the wins all the sweeter
I kinda get the rationale behind it. My daughter is trying to raise seed for an Ed-tech start up and every single VC funds first question is “ what is your AI strategy?” At this stage they can use AI to enhance their operations but don’t need to “have AI” So there’s a few companies that will create it and then multitudes will use those companies services but there seems to be so much capital going into anything that has the implication of AI. Very much like the tech boom and bust.
I'd suggest you could use AI to help set up your systems and analysis, to reduce reliance on AI down the track, and therefore vulnerability.
As it stands now AI is just another tool, and too much dependence on it could create problems.
On their way to the Supreme Court all lower courts have determined that the power to impose tariffs is seated with Congress and not the President. It would appear that at least some, and including some conservatives, agree, at least initially. Should the Supreme Court eventually sanction Trump’s tariffs then they will have become the greatest rubber stampers ever recorded and confirm that the USA is now in the hands of a virtual dictatorship.
“Given the stacked nature of the court, no-one really expects them to rule the Trump actions as 'illegal' . . . ”
The political nature and implications of the US court system - especially SCOTUS - is staggering compared to New Zealand.
While I was pleased that yesterday in Pennsylvania, Democrat judges were elected to their state Supreme Court to maintain a Democratic majority and is being celebrated by Democrats as a victory, the political nature of their court system really is troubling.
Interesting point on ZB this morning re NZ justice/courts that in pursuing and winning any action is very likely to cost you more than you are awarded as a result. Would imagine many on here are aware of the standard tradie riposte for the standard tradie rip off as being “see you in court then.” From experience the amount concerned is usually up to $30 - 40k. Would suggest in these cases and similar perpetrators, that if there was a real prospect of both damages and the other parties full costs being awarded they might need to reconsider their practice.
FYI for tradies who get stiffed by clients, there is ofen a chance to recover full legal costs incurred in recovering a debt either through following the payment claim process in the Construction Contracts Act and/or under standard terms of trade. I often hear many tradies say it is not worth chasing $30-40k but it can be if you are aware of your rights. Usually the client has some asset worth enforcing against (i.e. their house), so usually something to go after...
As a tradie, the best method I've found is to send someone round to the client within 60 days of someone being overdue, and put in the hard word. Some people worry that might give them a bad rep, but you don't want a bad payers business, and probably not that of anyone they know, either.
Going through the legal framework is just f*ckery.
I’m calling BS on this. You call them when somethings overdue. A knock on the door is a little down the line.
Clients can sometimes miss receiving invoices, or just forget them in their payment cycle. But anything over a month is a red flag. The recovery process normally goes
- send invoice
- send statement
- follow up (i.e., did you get the bill, when will you pay)
- one final contact about payment
- someone goes and knocks on the door
Experience has shown a high degree of proactivity is fairly crucial to ensuring you get paid. Waiting for a clients goodwill or legal framework to do it for you, is a less efficacious approach.
If you can't resolve a dispute amoung yourselves and have to rely on legal framework to find common ground
You've already lost
Around 20+ years ago I took Mark Bryers to court over a small debt with his personal guarantee for ~$5k. He never showed up so we got judgement. He ignored this several months. Then I sent Baycorp after him for judgement+legal+collection fees which nearly doubled the debt. He paid up within 48hrs.
.
Who doesn't enjoy a story with a happy ending?
What happens when you spend money on exploration.
"Under the first Trump administration and during the first trade war, President Xi Jinping called for a renewed effort to boost domestic output. Since oil production has risen by 13 per cent and gas has climbed by more than half. Both are on track to set all-time records this year, the equivalent of adding nearly an Indonesia worth of oil and an Algeria worth of gas to the balance of global supplies."
https://www.businesstimes.com.sg/international/global/chinas-us470-bill…
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.