Here's our summary of key economic events overnight that affect New Zealand with news Trump is about to make a national address (9pm NZT) where he is expected to claim Iran wants a ceasefire (which Iran immediately said was false). Many expect he will pull the US out of NATO as well (although Congress would have to agree for that to be effective). Despite the unhinged nature of it all, markets cheered the likely end of the pointless war he started.
Separately, on Saturday we will get the March US non-farm payrolls data which is expected to show a +60,000 gain. The ADP version of private sector employment was out today for March and that showed a similar modest rise (+62,000).
But we should also note that February official data for private sector hiring revealed a record low rate.
US mortgage applications fell sharply again last week, down a further -10.5% for a third consecutive big drop, which is unprecedented. Refi fell the hardest but new purchase activity was down sharply too. Rising interest rates continue there.
The widely-watched ISM factory PMI was little-changed in March from February with the same modest expansion recorded, as signaled in the alternate globally-benchmarked S&PGlobal version. The New Orders Index indicated slower growth compared to the previous month with new export orders actually in contraction. Both observed soaring inflationary pressures, back to pandemic levels.
US retail sales rose in February by +3.7% above the year-ago level. This month car sales led the increase. That is a real gain given that February CPI inflation ran at 2.4%.
In Canada their March factory PMI shows no growth, no decline.
The China S&P Global PMI expanded again, showing growth of output and new orders were maintained in March. But suppliers' delivery times lengthen the most since December 2022. And they also recorded their strongest inflationary pressures, since March 2022. Again, their PMI was slightly more upbeat than the official version.
Japan, Taiwan and Malaysia all recorded modest to good factory expansions in March in their respective factory PMIs, and all recorded higher inflation pressures.
Interestingly, the Bank of Japan's Tankan survey of businesses there for Q1-2026 shows little negative impact from the current geopolitical situation. Those firms surveyed remain quite upbeat.
In Europe, their eurozone factory PMI also expanded, and at a 45-month high. But the inflationary pressures were also very evident in their report.
In Australia, yesterday's national address by Prime Minister Albanese warned of a rocky road ahead due to their fuel crisis, and that urgent reforms are required, mainly because previous deregulation has left them uncomfortably vulnerable in this situation.
Separately, their main business trade association said their Industry Index fell 19.9 points in March to -23.6, the steepest monthly decline since the initial pandemic phase of early 2020. Industrial activity, employment, new orders and sales indicators all fell markedly in response to the emerging energy crisis. Uncertainty was the main factor, with 30% reporting volatility in fuel prices, freight and/or supply arrangements because of the energy crisis. More than a quarter (26%) of businesses said rising costs were a major pressure – in fuel, freight, raw materials, resins, plastics and packaging.
There was a surge in residential consents issued in Australia in February, with 19,022 issued. That is the most for any month since mid-2021. Of note is the rise in Victoria where over 6000 consents were issued. That compares to NSW's 4332 and Queensland's 3890 in February. It is notable that states with relatively lower new-build consenting are those with higher rises in house prices.
The UST 10yr yield is now just on 4.31%, unchanged from yesterday. The key 2-10 yield curve is marginally steeper at +51 bps (+1 bp). Their 1-5 curve is up +2 bps at +27 bps and the 3 mth-10yr curve is now steeper at +61 bps (+2 bps). The China 10 year bond rate is up +1 bp at 1.82%. The Japanese 10 year bond yield is down -3 bps at 2.32%. The Australian 10 year bond yield starts today at 4.95%, little-changed from yesterday. And the NZ Government 10 year bond rate starts today at 4.64% and down an outsized -12 bps from yesterday.
Wall Street started its Wednesday with the S&P500 up +0.6% but fading. Overnight European markets all rose between London's +1.9% and Frankfurt's +2.7%. Yesterday Tokyo closed its Wednesday session up +5.2%. Hong Kong was up +2.0% and Shanghai rose 1.5%. Singapore jumped +1.8%. The ASX200 ended its Wednesday up +2.2%. But the NZX50 ended down -0.7%, the only equity market to decline among those we follow.
The price of gold will start today up +US$142 from yesterday, now at US$4783/oz. Silver is up +US$1.50 to US$76/oz.
American oil prices are down -US$1.50 at just on US$100/bbl, while the international Brent price is down -US$2.50 at just under US$102/bbl. Ship transit traffic in the Strait of Hormuz seem to be slowly returning, but on Iran's terms.
The Kiwi dollar is another +30 bps firmer against the USD from yesterday, now at 57.7 USc. Against the Aussie we are down another -10 bps at 83.1 AUc. We are up +40 bps against the yen. Against the euro we are up +10 bps at just on 49.7 euro cents. That all means our TWI-5 starts today up +20 bps at just over 61.4.
The bitcoin price starts today at US$68,837 and up +1.8% from this time yesterday. Volatility over the past 24 hours has been moderate at just under +/- 1.5%.
Daily exchange rates
Select chart tabs
The easiest place to stay up with event risk is by following our Economic Calendar here ».
30 Comments
For me there is a huge irony here. JD Vance came out in the beginning, supported by Trump, saying the current administration didn't want to be sucked into fighting "other peoples wars" and defending other countries who hadn't maintained their defence capabilities. Now the US has started a significant conflict in the ME, perhaps coerced by Israel (US defending Israel) and now Trump is threatening NATO because they wouldn't join the US in fighting their illegal war against Iran.
It really is insane. But where is Vance? He has been unusually quiet during all this. Has he been sidelined?
He's potentially distancing himself from this cluster f, because he wants a shot at Pres in 28.
It's insane, if you've never had to deal with someone like Trump before. You can't go applying decent people logic to them.
They are keeping Vance strategically insulated from the polarising actions of Trump.
If they want to elevate Vance as a future presidential candidate, they must ensure he isn’t too caught up in the crosshairs. Perhaps protecting his credibility to maintain a Plan B as the current foreign policy backfires
My guess is they fail, but the 2030s will likely see a far more calculated, strategic and less brain fart prone candidate than Trump.
They have a weird setup in America:
a) The two term limit means the POTUS may as well do whatever they want in their second term as they can't get re-elected anyway
b) The POTUS doesn't seem to be reigned in by the party like they are here. I don't suspect Trump would have lasted very long as NZ's Prime Minister before his party gave him the boot.
POTUS can be reigned in, but the traditional Republican party has been destroyed in the last decade, replaced by MAGA stooges.
I agree. Controlled demolition of the American Empire to usher in the great reset?
Perhaps “Putin for POTUS”?
:-)
Since the start of the year Vance has shifted from a ~30% probability of being the next President to ~18% on polymarket. Partly as a result of Rubio's rise, but also a result of the fall of Republicans in general. From a 47% to a 41% probability of winning over the same time period.
Painter has it right - and there is no 'they'.
I have Vance's book (it sits alongside Kamala Harris' one - an interesting pairing). He is no Hegseth; he's an evangelist but not a raving one. He has the cohones to avoid being tarred with what is obviously an out-of-control brush. But - and the Nazis are a well-documented yardstick here - in those types of circles, everyone is eyeing off everyone else; when you chuck out the rule-book, there are no rules. Nights of the Long Knives can happen anytime.
But there is still the remains of democracy - although I'm betting that pre mid-terms some more will be lost, maybe enough to ensure permanent Republican control - and the smarter rats usually desert the ship first/earlier. Hence MTG (interestingly, Leavitt clearly has 1Q, and I'm surprised is still around). Some of them - Vance included - will still be thinking in terms of re-electability.
Big picture, Trump is temporary. Clearly fading fast, cranially. Someone will replace him, and Vance could hardly be less coherent. But that won't change the trajectory; just the pace. The US is finished as the dominant hegemony; the out-pirates (Buckminster Fullers glorious description) have circumvented the in-pirates. There will be a regrouping, maybe even a temporary stasis - my pick is China/Russia/India/other Brics in a bloc; UK, Canada, Aus and NZ, Europe in another, satellites to both and some - like us - attempting to straddle.
But the lid is sinking on the whole - extraction-rates and quality-decline are the bigger story - so how long those blocs stay co-operating before imploding? is the much bigger question.
Makes sense. Certainly more than some Free Mason conspiracy.
The concern will be the big autocratic powers like China. What will they do? A stable world based on individual freedoms and democracy has to be preferable.
And how sure are you to claim there is no “they” ??
You think Vance has complete free will as an independent operator?
Yes, Vance’s book is most certainly 100% reality and 0% propaganda so we should believe every word of it.
I didn't say that.
Read what I wrote, please...
And how sure are you to claim there is no “they” ??
Do you think it looks coherent?
There may well have been cliques and cabals - almost certainly.
But the bigger failure at this point, is to concentrate at the 'Trump is the problem' level, without seeing why Trump, x2, in the first place. The gap between rich and poor was widening, even as the physical extraction it was all based on, was hitting limits. The disenfranchised said Seig Heil, as they tend to do, but you have to trace that back (I also have Von Papen's biography - further along the bookshelf - Weimar Germany has a lot of similarities to the current US).
It seems you are concluding there is no ‘they’ because of what appears to be disorderly chaos. My challenge to that is, why does it need to look coherent?
The unspoken bipartisan religion of US politics has the motto “Ordo Ab Chao” which in latin means Order out of Chaos. By perceiving chaos as proof there is no invisible hand at play, you could be walking into their mind trap. Chaos is a tool to implement change.
I am in complete agreement with you regarding Trump being the symptom, not the cause. He is the distraction and has been installed for a reason. One of them no doubt being to help exacerbate the wealth gap. But he is not in ultimate control of this ship.
It is unfortunately relevant to develop comparison to the Nazis in so much that even with Berlin & Germany virtually demolished the senior underlings were fighting viciously between themselves as to who would be the next Fuhrer. In that regard, the head honchos in the Republican Party don’t look all that dissimilar. There is and abundance of suppressed vendettas, rivalry and ambitions seething like snakes in a barrel. It is only the very unusual weight of a very unusual President sitting on the lid that is preventing it from all bursting out.
There's no hidden complexity with Vance. All that needs to be understood is that he's Thiels boy. Authoritarian techo oligarchy, with some sort of pseudo "christianity" mixed in, is the end game.
That's right. He's a product of Peter Thiel and represents the political vehicle for the technocratic elites
Whose world is hitting its Limits (the last scenes from 'Don't look up' are pertinent - they are looking to escape what they know will be a trashed planet).
Some ratify that cranially, with rapture/armageddon/second-coming.
But seeing them as the problem, misses the point. They are, like Trump, symptoms not causes. The bigger problem is the overshot state of our species, and the fact that it is rapidly altering its habitat (Earth) to the point where it won't survive.
JD Vance bent the knee like all MAGA must.
“President Trump will not get the United States into a years-long conflict with no clear objective. Iran can never be allowed to obtain a nuclear weapon. That is the goal of this operation and President Trump will see it through to completion.”
“I said this before the conflict started, I’ll repeat it again — there’s just no way that Donald Trump is going to allow this country to get into a multiyear conflict with no clear end in sight and no clear objective. What is different about President Trump, and it’s frankly different about both Republicans and Democrats of the past, is that he’s not going to let his country go to war unless there’s a clearly defined objective. He’s defined that objective: It’s Iran cannot have a nuclear weapon and has to commit long-term to never trying to rebuild the nuclear capability. It’s pretty clear. It’s pretty simple. And I think that means that we’re not going to get into the problems that we’ve had with Iraq and Afghanistan.”
https://www.nbcnews.com/politics/jd-vance/vance-anti-war-posture-collid…
Many expect he will pull the US out of NATO as well (although Congress would have to agree for that to be effective).
Has Trump and his cohorts ever sought agreement from congress for anything they've decided to do.
Watched an interview with the Iranian foreign minister last night and he said Iran has not asked the US for any concessions nor agreed to any demands, despite what the professional bullshit artist at the Whitehouse is telling everyone.
The out-pirates are well aware of the cards they hold.
Our problem is that most of our media are too tainted to listen
Trump's a loser
Some weeks ago there were assurances from Israel & America that Iran had already fired off 90% of its offensive capacity. The following weeks would obviously have increased that percentage. Why then is America asking for a ceasefire if Iran has nothing much with which to cease firing ?
https://en.wikipedia.org/wiki/Project_2025
Place a greedy brain dead frontman politician in the WH, allow him to enrich himself and his cronies however they like provided certain policies are enacted and wait.....and that greedy braindead politician dosnt need to be named Trump.
Re: “Trump is about to make a national address (9pm NZT) where he is expected to claim Iran wants a ceasefire”
I think the NZ time is incorrect.
The address is to broadcast from the White House at 9:00 pm Wednesday US EST, which is Thursday 2:00 pm NZT.
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.