Here's our summary of key economic events overnight that affect New Zealand, with news the US is moving to end its government shutdown.
First, Wall Street has started its week positively with the S&P 500 rising, the Nasdaq rising even more, and the Dow Jones gaining over 240 points as optimism grew that the US Federal government shutdown could soon end. In a procedural vote yesterday, the Senate advanced the first stage of a deal to reopen the government, securing the minimum 60 votes required. Eight Democratic senators broke with party leadership, dropping their key demand for a guaranteed extension of healthcare subsidies. The proposal must still be debated and passed by the Senate and approved by the Republican-controlled House of Representatives, where its passage remains quite uncertain.
There was a three year US Treasury bond auction earlier today and that delivered a median yield of 3.54%, essentially unchanged from the 3.53% at the prior equivalent event a month ago.
In Canada, their market participants survey showed that trade tensions with the US are the key issue driving financial market. Despite that, those surveyed reckoned 2025 will deliver a +1% economic expansion this year and more next year.
In Indonesia, there was a good bounce back in consumer sentiment in October after five months of angst. The affordability crisis that played out on some streets seems to have faded somewhat.
The UST 10yr yield is now at 4.11%, up +2 bps from yesterday at this time. The key 2-10 yield curve is now at +52 bps. Their 1-5 curve is now +5 bps positive and the 3 mth-10yr curve is now +17 bps positive. The China 10 year bond rate is up +4 bps at 1.80%. The Australian 10 year bond yield starts today at 4.38%, up +2 bps from yesterday. The NZ Government 10 year bond rate starts today at just on 4.14%, up +2 bps.
Wall Street liked the Federal government re-opening so the S&P500 is up +1.3% in their Monday trade. European markets did too, and they rose more than +1% everywhere there, some to record highs. Tokyo ended yesterday up +1.3%. Hong Kong was up +1.6% and Shanghai was up +0.5%. However Singapore dipped a minor -0.1%. The ASX200 ended its Monday session up +0.8%, while the NZX50 only managed a +0.1% gain.
The price of gold will start today at US$4092/oz, up +US$92 from this time yesterday and a +2.3% gain on bets the Fed will cut its rates after weak US data. Silver surged +3% to US$50/oz, its highest level since October 20. Precious metals pricing indicates some market participants aren't impressed by the US shutdown progress.
American oil prices are down -50 USc from yesterday at just on US$59.50/bbl, with the international Brent price unchanged at US$63.50/bbl. Fundamentally low expected demand is keeping this price low. It is holding at 4 year lows and at levels first seen in 2017.
The Kiwi dollar is now at just on 56.3 USc, and unchanged from yesterday. Against the Aussie we are -10 bps lower at 86.4 AUc and a new 12 year low. Against the euro we are up +10 bps at 48.8 euro cents. That all means our TWI-5 starts today at just under 60.9 and up +10 bps from yesterday.
The bitcoin price starts today at US$105,120 and up +1.4% from yesterday. Volatility over the past 24 hours has been modest at just on +/- 1.5%.
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10 Comments
The Trump administration is working on 50-year mortgages to help the housing market, but the maths are pretty bleak:
"Consider someone taking out a $500,000 home loan. The current rate on a 30-year mortgage is 6.22%, per Freddie Mac. For these calculations, let's assume that a 50-year loan's interest rate exceeds the 30-year by the same margin that the 30-year rate exceeds a 15-year rate.
That translates to a 6.94% rate on the 50-year loan — which would then have a monthly payment of $2,985, only $83 less than the 30-year mortgage."
"After three decades, when the 30-year mortgage is fully paid off, the 50-year borrower would still owe about $387,000."
https://www.axios.com/2025/11/10/trump-50-year-mortgage-loan
So an odd bit of compromise has the US government open again. Back on its feet but looking something like the proverbial punch drunk fighter. Reminds me too in a way, when I was young, overhearing my grandfather discussing with our farm neighbours, the issue of cattle with the staggers.
Total repayment cost $1.79m?
To retire at 65 you have to buy the house at 15. I guess the idea is that you increase repayments over time. Sounds like subprime all over again though- if you can’t afford the 30 year repayments then maybe it’s a bad idea.
At a 50y maturity, the loan is almost interest only.
What you fail to consider, is the time value of money. Please discount $387k back to today from t+50y and let me know your findings.
The Gold and Silver Bulls are back on the charge again, after chewing their cud for 3 weeks......
Gold to break 5k and Silver well past $70/80 in 2026 imho.
Super profits for miners are about to be paid to shareholders before years end, with new record profits to come in 2026.
If anyone is in any doubt as to just how cancerous the left is, I present Witness A, the BBC. Caught red-handed fabricating news reports to attempt to mislead the public and negatively tarnish Trump (tantamount to an act of war in my opinion). What else, oh yes misrepresenting Gaza/Israel conflict. You know, BAU for the mainstream media.
The BBC used to be a world leading and widely respected organisation producing an amazing variety of world-class content. Now it's a hard left propaganda unit peddling lies and misinformation.
A metaphor for the decline of the UK.
The actual cancer is the partisanship, Red team vs Blue team that dominates our politics. They can both eat a bag of dicks.
Partisanship is healthy when it operates within the rules. When a global, state funded media organisation splices together footage 54 minutes apart to tarnish a US presidential candidate and attempt to sway US public opinion, we are in a dark place.
There's rules?
Both of these poles liberally manipulate and extort truth to push their causes. Because it's way sexier than some sort of pragmatic middle ground.
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