Here's our summary of key economic events overnight that affect New Zealand with news gold and silver are currently experiencing the volatility we saw with bitcoin in 2024/25. Meanwhile, bitcoin is being dumped heavily today.
Today starts with a series of unfortunate delays. The overnight dairy auction has concluded after an extended delay, but there is further delays in reporting the outcome. We will update this item when those results come through.
And there are delays in some key US data due to the snap federal government shutdown. We expected to report the December JOLTs report today but it is in abeyance now. And the January non-farm payrolls report will get delayed as well for the same shutdown reason.
But we did get US logistics data overnight, their LMI. This rose because they started building inventories in the way they did in January a year ago, but not excessively. Of note however is that inventory costs rose a sharp +8.4% this year, which will no doubt focus management minds.
There was a secondary survey out overnight on economic optimism in the US and that was moderately positive. The RealClearMarkets/TIPP Economic Optimism Index rose to its highest since August and above expectations. But to be fair it is still below the 2025 average and -6% lower than its year-ago level. But at least it is off its November low.
In Canada, their large aircraft manufacturing industry is holding its breath. The Trump FAA is withholding technical certification for new-built Canadian aircraft, waiting for the president to decide on the issue.
There was an unusual and notable rise in consumer sentiment in Taiwan in January, to its highest level in nine months. It is back up to mid-2023 levels after a general decline that started in September 2024.
And China warned Panama there would be "heavy prices" to pay after a court ruling in Panama annulled Hong Kong-based CK Hutchison's contract to operate two ports at the Panama Canal. This reaction will have relevance for the Darwin port issue, where a new 99 year lease owned by a Chinese firm is under threat of annulment too.
In Germany, and despite solid demand holding up, investors there are expecting and getting higher risk premiums for their government 30 year bond. It yielded 3.55% today, its highest in 15 years. It's 10 year bond is almost at 2.90%, and also near its 2011 levels. Germany plans to raise more than €500 billion this year to fund infrastructure upgrades and for defense spending. But most other European countries are doing the same, and that is driving up yields.
In Australia, and as expected, the RBA raised its policy rate by +25 bps to 3.85% and ending its shortish easing cycle. Most big banks there have already announced a full pass-through to their home loan and business lending rates. The RBNZ reviews its policy rate on February 18, 2026 but is not expected to make any changes to its 2.25% rate at that time.
The UST 10yr yield is now just on 4.29%, up +2 bps from this time yesterday. The key 2-10 yield curve is still at +70 bps. Their 1-5 curve is now at +34 bps and the 3 mth-10yr curve is now up at +60 bps (+3 bps). The China 10 year bond rate is holding at 1.81%. The Japanese 10 year bond yield is up +2 bps at 2.25%. The Australian 10 year bond yield starts today at 4.85%, up +2 bps. That is near its highest since 2011. The NZ Government 10 year bond rate starts today at 4.63%, down -2 bps.
Wall Street has started its Tuesday weaker with the S&P500 down -1.1%. Overnight European markets closed down between London's -0.3% and Frankfurt and Paris's -0.1%. Yesterday Tokyo ended its Tuesday session up a huge +3.9%. Hong Kong rose just +0.2% but Shanghai was back up +1.3%. Singapore up +1.1%. The ASX200 rose +0.9%. But the NZX50 only managed a +0.1% gain.
The price of gold will start today up +US$273 from yesterday at US$4980/oz. Silver is up +US$8 to US$US$86.50/oz. Some non-precious metals are bouncing back sharply too.
American oil prices are up +50 USc at just over US$62.50/bbl, while the international Brent price is now just over US$66.50/bbl.
The Kiwi dollar is up +40 bps against the USD from yesterday, now at 60.5 USc. Against the Aussie we are down -10 bps at 86.2 AUc. Against the euro we are up +30 bps at just on 51.2 euro cents. That all means our TWI-5 starts today just under 64.1, and up +30 bps from yesterday. And the Chinese yuan is at its strongest level against the US dollar since 2023.
The bitcoin price starts today at US$74,990 and down -5.0% from this time yesterday, and falling. The last time it was this low was in mid November 2024. Volatility over the past 24 hours has been modest at just on +/- 1.7%.
Join us at 10:45am for the latest Q4-2025 labour market data for New Zealand where an unchanged but high 5.3% jobless rate is anticipated . And variation may well have financial market implications.
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22 Comments
It will be likely more than interesting as to what actual action China pursues from being shown the exit door in Panama followed by Darwin. With regard to the latter it would hardly be compatible for Australia to have quasi US nuclear sub bases in ports on its west and east coasts with a large Chinese port sandwiched to the north.
It's intriguing that with the adversarial politics of recent years that countries did not realise or understand the nature of the politics behind the overt business contracts?
That's been a point in many of the discussion threads on this site, and I would government advisor would see what we could?
80 years without a major global conflict has obviously instilled a sense of complacency. Politicians up until and in the aftermath of WW2 had recurring reason to scope strategically how and where to defend their nation’s interests. Back to the drawing board is now underway it would seem.
I'm not sure what the answer is though. A world with fairly open trade has been shown to accompany substantial increases in global living standards, and protracted periods of relative peace, compared to the centuries before.
The problems arise more from inabilities to keep power in check, and to halt the political malaise that sinks in when things get too comfy.
I'd suggest Foxy is closer Pa1nter. Complacency with a fair chunk of ignorance of the politics and type of rule in China and how even private companies must comply with state direction.
Access v control are areas that perhaps should have been actively considered and managed?
Complacency with a fair chunk of ignorance of the politics and type of rule in China and how even private companies must comply with state direction.
AIRBUS was made from the remnants of the likes of Messerschmitt and Focke-Wulf. Companies co-opted by their government for military purposes.
And us Europeans have a proven track record of centuries of colonisation and military expansion and aggression.
I'm not so convinced they're the ones to be wary of. About the only thing I would say, is in the Wests' hubris over their perceived superiority, they under estimated the likes of Japan and Chinas ability to beat us at our own economic game.
I'm not suggesting they are the only ones to be wary of. I think a Republican America offers some concerns too. But in truth any of the powers could easily become the next tyrant.
Months ago a read a report from a retired US military vet who asked the question; "We're the good guys, right?" and postulated that the answer to it was increasingly less clear.
The German military aircraft contribution to commercial aviation is no different to, Boeing, Vickers or Tupolev. The point being made here is though, regardless of the reasons or justification, unfortunately it now seems obvious that the world powers are reverting to the posturing and positioning prevalent in the cold war.
The threat from China is not gunboats and soldiers. Thats not the method.
More likely they will own us as our puppet politicians will have to stand to attention as they are lectured on 'wrong thinking'
Already on the first steps.
.........ignorance of the politics and type of rule in China and how even private companies must comply with state direction........
That complying with state direction happens here too. It's a question of degree. No economy can function effectively without rules and enforcement. I'm not advocating for the Chinese system, just pointing out that state role in commercial and private affairs is a spectrum, a bit like autism.
I'm not even sure that can be obvious. We know that at the drop of a hat, our democratically elected government can:
- prohibit you from leaving your home
- prevent companies from operating
- track the populations movement electronically
- mandate the population have medical treatments to earn a living
Yes, but it was pointed out some months ago that any Chinese owned company must obey the direction of their state security apparatus. Our country does not require that of our companies.
It effectively makes all their locally owned but foreign based companies a political tool for their government.
What I noticed was not ports but no Canadian made aircraft entering the USA. Really ?
I guess that likely will change but if it continues it's a major marker on the way the world works.
So bitcoin is being dumped and rotated into the real currency, store of value: Gold and Silver.
Pater Shiff in his many podcasts, has told his metal peeps to do this for a long time and it's really happening.
- "Michael Saylor continues to promote buying and holding Bitcoin despite sharp price declines".......
Bad move Mike. The tide goes out bigly for you.
HODLers are getting a lesson on the BitPonzi.
The market for precious metals dwarfs that of crypto though. So you can't really attest a direct sell of one to get into the other, the real big buyers of gold are unlikely to have their tippie toes in the Bitcoin pond.
More likely, it's to do with the motivations of Bitcoin collectors, who get enamoured with big price shifts. The old party got boring so let's jump on the next bandwagon.
Well a significant majority of the crypto crowd believe BTC to be digital gold. Yet the gold crowd certainly don’t claim gold to be physical bitcoin. The label is a one way street. Bitcoin’s current status is borrowed from gold.
The recent crypto sell off is happening during risk off trading. BTC is not performing as a safe haven asset or reliable store of value. It’s failing the digital gold stress test.
So as the digital gold narrative fades, where to for BTC sellers?
I must admit to not feeling surprised. Despite all the past discussion of relative value; Crypto v Fiat, I think this was inevitable. That it is driven by the effects of a political disrupter being the President of the USA is somewhat of a surprise. If they're migrating to metals, then it is probably that their store of value their may lose a bit too.
If there were international conflict, and undersea internet cables were purposely damaged, bitcoin would hold next to no value, where as precious metals would be a physical good that could be traded and bartered for other goods and services. Value in innate things such as currency, crypto etc is based on faith and expectation if it isn't a useful good or service. If the world loses expectation of growing returns, they bail form the investment, or if they see the use of the investment as becoming less useful, they bail. We're simply seeing the world follow the previous patterns of flocking to physical resources which have a tangible use vs relying on faith and expectation.
Meanwhile, at The Warehouse:
https://www.rnz.co.nz/news/business/585885/270-head-office-jobs-to-go-a…
But wait, it's a "lagging indicator", right?
Many of the examples you use are of businesses running outdated models that havent kept up with the competition.
You mentioned EBGames a few weeks ago. The market has mostly shifted to game subscription services, or buying games digitally via Steam. A bricks and mortar gaming store is largely redundant in 2026.
Likewise, KMart is eating a lot of The Warehouse's lunch.
A few years of flat or negative trading as we've had becomes the inflection point for these sorts of businesses. 2025 showed an uptick on the formation of new businesses in NZ.
Digital purchases irritate me. Take the likes of nintendo: You can buy the physical game, and it is yours to use, sell with the console to someone else etc, or, you pay a little less to download it and effectively have the licence to use it until you sell the console, where you reset the console and the next person loses all access to the games you paid for. They double their money and pay less for physical product manufacturing. I despise the subscription economy for this reason as it is pure extraction form consumers.
How about Netflix
It's great, cheap, huge library, no ads, and you can binge a new show.
Enough of you onboard? Ok, we have to make a few changes:
- price can go up
- we'll loose a bunch of our licenses, so you'll have to get 3-4 other services now
- how bout we put in a few ads
- while we're at it, we'll release our new shows periodically, so you can tune in weekly
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