Here's our summary of key economic events overnight that affect New Zealand with news of the US mess in the Persian Gulf gets worse. Iran has shot down two US airplanes, but is now letting French ships pass through the Strait of Hormuz. US oil prices are now higher than international prices. The flight to safety is devaluing the NZD.
But today starts with confusing US employment data. The headline data says "Payroll employment increases by 178,000 in March; unemployment rate changes little at 4.3%." But the same headline data shows February was revised lower by -133,000. For Q1-2025 this payroll data show a rise of +205,000 (seasonally adjusted) to 158,637,000 in jobs. Despite that, their participation rate fell, and average weekly hours fell. There was essentially no rise in average weekly earnings (+US$1.70 for a week).
However, a look at the official household survey data shows a seasonally adjusted employment level of 162,848,000 in March, while the revised February data is 162,912,000. By our math, that is a fall of -64,000. February fell by -185,000 on this measure, so for Q1-2026 that is a total -856,000 civilian jobs lost (seasonally adjusted). (-956,000 lost on an 'actual', unadjusted basis.) The difference is the self employed and jobs in unincorporated micro businesses. It seems they are under extreme pressure to twist to overall data that much.
US vehicle sales recovered in March. 1,043,000 vehicles were sold in March, up from 1,224,000 in February. Cars accounted for 237,000 units in March, while light trucks totaled 1,167,000 units. This poushed the annual rate higher to its best since September.
The S&P Global US Services PMI fell to 49.8 in March of 2026 from 51.7 in the previous month, the first contraction in the sector in over three years. The decline came amid the weakest growth in new business since April 2024. The ISM services PMI isn't released yet.
US oil rig counts rose by two last week. Despite the high prices, no-one is rushing to pump more.
In the US private credit market, pressures are building as investors rush to get their money out, causing ever more 'moratoriums'. Junk bonds are feeling this exit pressure from investors too.
In China, the S&P Global services PMI growth of activity eased from February's strong pace. New business expansion was driven by domestic demand. Cost pressures remain modest, enabling lower discounting.
In Japan, their services PMI expanded solidly again, but they are noting higher cost pressures.
In India, their factory PMI slowed again, under sharper cost rises. Their growth of factory orders and production eased.
The FAO Food Price Index rose for a 2nd straight month in March to its highest since September. Prices across all commodity groups rose, Dairy prices were up +1.2%, the first increase since July, driven primarily by higher prices for skim milk powder, butter, and whole milk powder. Meat increased +1% mainly driven by higher pork and beef prices.
The UST 10yr yield is now just on 4.35%, up +5 bps from yesterday. The key 2-10 yield curve is marginally flatter at +50 bps (-1 bp). Their 1-5 curve is unchanged at +27 bps and the 3 mth-10yr curve is now steeper at +66 bps (+5 bps). The China 10 year bond rate is unchanged at 1.82%. The Japanese 10 year bond yield is up +6 bps at 2.38%. The Australian 10 year bond yield starts today at 5.01%, up +6 bps from yesterday. And the NZ Government 10 year bond rate starts today at 4.76% and back up an outsized +12 bps from yesterday.
Wall Street ended its Friday with the S&P500 little-changed, up +0.1%. Overnight European markets were mixed between London's +0.7% and Frankfurt's -0.6%. Yesterday Tokyo closed its Friday session up +1.3%. Hong Kong was down -0.7% and Shanghai fell -1.0%. Singapore fell -0.6%. The ASX200 didn't trade of course. And neither did the NZX50.
The price of gold will start today down -US$107 from yesterday, now at US$4676/oz. Silver is down -US$3 to US$73/oz.
American oil prices are up a sharp +US$11.50 at just on US$111.50/bbl, while the international Brent price is up +US$7 at just under US$109/bbl, an odd time it is lower than US prices. Ship transit traffic in the Strait of Hormuz seem to be slowly returning, but on Iran's terms. A French ship is the latest to pass through.
The Kiwi dollar is down -80 bps against the USD from yesterday, now at 56.9 USc. Against the Aussie we are down another -40 bps at 82.7 AUc. We are down -60 bps against the yen. Against the euro we are down -20 bps at just on 49.5 euro cents. That all means our TWI-5 starts today down -60 bps at just over 60.8 and its lowest since November.
The bitcoin price starts today at US$66,921 and down -2.8% from this time yesterday. Volatility over the past 24 hours has been low at just under +/- 0.8%.
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