Here's our summary of key economic events overnight that affect New Zealand with news of little progress in renewed US-Iran 'peace talks'. They seem to have descended into talks about extending the ceasefire rather than resolving any issues. The Strait of Hormuz is still essentially closed. Complicating the oil supply picture is that US crude inventories fell by -9.1 mln barrels last week, far exceeding analysts’ expectations for a modest +154,000-barrel increase. This is actually a big deal and has driven the oil price higher today.
In the US, initial jobless claims rose to 214,000 last week, but not as high as seasonal factors would have indicated. There are now 1.89 mln people on these benefits, less than this time last year but more than two years ago.
But American industrial production fell in March from February, its first fall in four months. That makes it only +0.7% higher than year-ago levels, and hardly a surge in re-shoring. If it wasn't for the growth of AI centers and the electricity required to run them, this would have been a very disappointing result - and it probably is more most companies.
That said, the latest update from the Philadelphia Fed's factory survey was quite positive in April, driven by good growth in new orders. Of course they are measured in nominal dollars and these firms reported notable rises in inflation, for both costs and prices.
In China, new home prices across 70 key cities fell -3.4% in March from a year ago, a minor worsening from a -3.2% decline in February. That was the 33rd straight month of contraction and the steepest drop since May 2025. Pre-owned home sales prices fell harder although for the first time in a while some key cities recorded month-on-month rises in prices.
China said its Q1-2026 GDP expansion was up 5.0%, and better than the 4.8% expected and the official target of "about 4.5%". And its industrial output was up +5.7% in March, they said. But their retail sales only grew 1.7% which will have been a disappointment because they really need a better rise in internal demand. All the good data reported is somewhat undermined by their data that shows electricity production fell again and for a fourth month, up just +1.4% from March 2025.
Australia's March labour market report was pretty tame. The employment rose by +17,900 (about the +20,000 expected) and the number of unemployed people fell by -4,000 in the month. The unemployment rate remained steady at 4.3%. Full-time employment increased by +52,500 to 10,174,400 (after the -27,700 fall in February) while part-time employment decreased by -34,600 to 4,593,300.
The expected inflation rate rose by 0.7 percentage points in April to 5.9% in Australia. It was 5.2% in March. The sharp rise in April reflects the recent spike in oil prices, and makes it its highest since November 2022. In contrast, wage change expectations have remained unchanged for the past five months.
In Australia, the big fire at the Geelong Vic. refinery, one of only two in the country, has major implications for Australia's fuels. They will need to import more from a global system already strained with demands on it. (The other one is the Ampol one in Brisbane.) Talk of needing emergency fuel savings measures, especially in Victoria, are growing.
Global container freight rates dipped -3% last week from the prior week to be little-changed from a year ago. But bulk cargo freight rates rose +16% last week, and are now almost double what they were this time last year.
Global travel rose +4.1% in 2025 according to new research with 80 mln people on the move. But they are increasingly avoiding the US where visitor numbers fell -5.5%. The main gainer is China where visitor numbers rose +9.9% and is predicted to eclipse the US has the main global destination - at this rate in just three years. It is a fast reversal.
The UST 10yr yield is now just on 4.31%, up +3 bps from this time yesterday. The key 2-10 yield curve is at +53 bps (+2 bps). Their 1-5 curve is at +23 bps (+3 bps) and the 3 mth-10yr curve is at +64 bps (+5 bps). The China 10 year bond rate is now at 1.78%, unchanged. The Japanese 10 year bond yield is also unchanged at 2.41%. The Australian 10 year bond yield starts today at 5.00%, up +3 bps from yesterday. The NZ Government 10 year bond rate up +1 bp at 4.68%.
Wall Street is marginally firmer with the S&P500 up a little less than +0.2% in Thursday trade. European markets mixed between Frankfurt's +0.4% and Paris's -0.1%. Tokyo rose sharply, up +2.4% in its Thursday trade. Hong Kong was up +1.7%, and Shanghai was up +0.7%. Singapore was dipped -0.3%. The ASX200 also dipped -0.3%. And the NZX50 ended down a minor -0.1%.
The price of gold will start today little-changed, down just -US$5 at US$4488/oz. Silver is down -50 USc at US$78.50/oz.
American oil prices are up +US$2.50 at just over US$95/bbl, while the international Brent price is up US$4, and now at US$99.50/bbl.
The Kiwi dollar is down -20 bps from yesterday at this time at 58.9 USc. Against the Aussie we are also down -20 bps at 82.2 AUc. Against the euro we are down -10 bps at just on 50 euro cents. That all means our TWI-5 starts today also down -20 bps from yesterday at just over 62.2.
The bitcoin price starts today at US$74,361 and up +0.2% from this time yesterday. Volatility over the past 24 hours has been modest at just on +/- 1.5%.
[There will be no video version today.]
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46 Comments
Re the US oil stocks, could there be a simple explanation? If their storage capacity was close to full, and they had rolled off supply to just maintain it, then with the current supply shortages and demands suddenly ramping up, there could be a lag in ramping up delivery to maintain stocks?
Perhaps in normal circumstances and a temporary blip, but is this more likely to be a hole in Trump's rhetoric which shows the US is more vulnerable than he would like the world to think?
We were running full-noise, just-in-time.
Energy and GDP (false measure that it is) move in lockstep - for obvious physics reasons (any deviation either being energy-demand in abeyance, or inflation ditto).
Doesn't take much margin-reduction to have an impact.
I'd suggest most of JIT died a sudden death with COVID. One of it's lessons. Nations have always understood that fuel reserves were a critical strategic necessity and asset, so not so much. That's why Europe are talking 60 odd days of supply, NZ 14 - 30. I'd suggest the lower the number the more complacent government planners were, and now it is well understood that our government essentially had it's head in the sand across multiple generations.
But even as those reserves deplete in a crisis, the level of impact increases as the timeframe to fix the supply issue or find alternatives, runs out.
Just a clarification; reserves are generally defined by a base level to never deplete beyond, except under exceptional need. Virtually no product has unlimited storage life, and most in one way or another will deteriorate fairly quickly unless the storage environment is specifically maintained to preserve the product. That's pretty rare. Fuels, foods and a lot of medical supplies are meant to be cycled through with quite limited storage times.
Good post.
The usual failure is to differentiate stocks from flows.
Also to silo-ise; to address food without addressing energy, being a classic.
and now it is well understood that our government essentially had it's head in the sand across multiple generations.
As with many heavy industries, the cost to replace and maintain equipment was more than offshoring production so we have, like with moving manufacturing to China for cost savings, simply removed our own self-sufficiency in many sectors in the name of 'money' which, in times of crisis, leaves us much more vulnerable.
in the name of 'money' - and of course in the name of the climate change industry. The ETS costs imposed shut down industries like domestic oil refining, food and wood processing etc. so we import from countries without an ETS, and in the case of China, lax pollution and labour rules.
Yep, same moral dilemma. Imposing restrictions domestically and still doing the same things via proxy countries. I've mentioned the pork situation before many times to attest to this.
I've been thinking (ha, ha, ha).
A lot of eyes watching the days of fuel supply stored in country (headline somewhere Europe only has 60 days jet fuel).
No apparent commentary, though, on how many days of food supply is in country. A cynical take is that attention is more focused on travel capacity than feeding the population
It's a fair comment, but fuel is required to distribute it. Like all those factors location is a critical component of volume. Not much chop if there is lots of a commodity but no way to make sure it can get distributed everywhere it is needed.
And really that's the essence of my comment Murray. And where available fuel resources are allocated should recognise and prioritise the importance of food supply over catching a plane for one's next holiday.
And COVID had some reiterating their absolute right to travel as much, as far and as often as they want.
Once upon a time folk had veggie gardens and fruit trees, there was an IGA, GBH, 4Square in walking/biking reach that also had a delivery boy on a bike, ditto for a butcher. There were too, orchards and market gardens close to town Guess that was a degree of local self sufficiency out of a necessity that has been replaced by another necessity, nationally.
FG. I was one of those delivery boys, I vividly recall battling the 1968 wahine storm which blew me off my bike. Managed to salvage the parcels and struggled on. You'd no doubt remember the the advertising radio ditty 'self help are cheaper, cheaper, cheaper', signalling a retailing revolution was on its way. Imagine the price we'd be paying for goods if those same inefficient distribution systems you nostalgically describe still existed.
"how many days of food supply"
Ah well, business as usual is considered the automatic default of this global growthist ideological program we've been running. A force of nature. We need a constant flow of happy talk to keep us all drugged up to the eyeballs, ready to spend, spend, spend, consume, consume, consume. Don't look left, don't look right, in case you see how shaky this whole experiment in defying physical limits actually is.
Don't scatter the pidgeons, in 60 days the S&P will be setting new records, we'll all be shopping and flying around the planet with gay abandon, and the all the news will be Muskovite hawking SpaceX for $US2trillion on his way to becoming the planets first Quadrilionaire.
S&P is already at a record high as far as I know. Not reported by DC above.
The worlds payroll feeding the insatiable.
Thinking about thinking, I made a comment last night re same.
We perhaps could gain hereabouts by tightening up on thinking.
It started with me positing that we wouldn't be doing one specific thing, within one specific timeframe.
Comment #! stated: 'We cannot predict the future'. Globally, that may be true; too many variables. But specifically it isn't; everyone currently alive will be dead in 100 years, bar a handful, for instance. This is the same approach as 'the stone age didn't finish for want of stones, therefore the oil age...'. The flaw is in the genre/scope flip - using one to reject the other.
Comment #2 basically said 'the last period was no trouble, therefore then next time-equal period won't. That too, conflates genre - in this case linearising the exponential. In the last 30 years (the period in question) we used 1/2 of all the fossil energy ever used. In other words, a 30-year doubling-time, in other words circa 2.5%. We are 1/2 way through the stock - the last half of anything is the last possible 'doubling', so in theory we've 30 years to go (won't happen that way, of course, due to de-growth implications).
Comment #3 stated that efficiencies were nothing to do with physics. That's just plain wrong: the 2nd Law of Thermodynamics (and Sadi Carnot) always override - efficiencies therefore all have upper limits.
A more thoughtful exchange was what I was watching at the time: The Spaceship We're Already On with Tom Murphy & DJ White | RR 24 - YouTube
Well worth taking the time
Comment #2 There is a problem with this statement; "the last period was no trouble, therefore then next time-equal period won't. That too, conflates genre - in this case linearising the exponential."
The end of the stone age was largely marked by the development of technology to replace stones, i.e. tools and then weapons. They didn't have organisations that suppressed the development of new technologies to entrench the dependence stones, which they controlled the supply of.
The oil age is virtually the opposite. Across the last 100 or so years the oil companies have embarked on a number of strategies that actively and passively suppressed the development of any technology which would have offered an alternative to their product, thus reducing its impact, utility and value to every society on the planet. They have backed our species into a corner, prevented our growth and development to a significant extent which may actually led to the near extinction of the species.
That's actually politics that denied the finite limits of a physical resource.
Murray, I regard you as one of the better brains on the site - but you missed this one, and It's important.
The flaw was in the genre-flip. The stone age is referring to materials (at the outside, technology). The oil age is about energy. No common denominator.
If we are to find a common denominator, the stone age was actually the firewood age (now energy is both sides of the equation.
Through that lens, we can see history as a series of overreaches of energy - local food-production, local firewood, attempts to go further for both, overreach, collapse.
Now we know that Gibbon (Decline and Fall) got it wrong and can work out that he failed to understand the importance of energy. We can see that Diamond (Collapse) worked it out. The flip in the saying - and I think it was intentional - is the stones vs oil genre thing.
As for the oil co's - yes they have protected, but there is no contender within some orders of magnitude - as we've seen by the recent global panic. And there is no clear thinking yet - RNZ this morning was all about switching to EVs.
We're coming at it from two different directions PDK. I do understand what you're trying to get across, but your blinkers are around physics and you're introducing politics.
I'm looking at cause and effect. Actually it wasn't the firewood age which is the demonstration of your blinkers around energy. The "age' name is about the level of technology; Stone - effectively none, bronze - some to melt out the softer metals and merge them (but did they understand the basics of metallurgy?), iron - stepping further in, and so on. We have shifted to talking about an "Oil" age because that has become the overwhelming defining component of how we got to where we are now.
The human attitude of "She'll be right" doesn't work because when oil vanishes and there is nothing to replace it as an extremely far reaching sort of basic energy, then virtually every other aspect of our societies is threatened with collapse. Too many people on the planet, is not the immediate issue, although it is pressing, the lack or shortage of the fundamental basis on which our societies are built is the immediate issue. The reasons that is happening must be understood for there to be any possibility for the salvation of the species.
"...when oil vanishes and there is nothing to replace it.."
Oil is just going to "vanish" is it? And there will be no partial substitutes, no demand reduction, no efficiency gains and no system redesign?
The real risk is not oil "vanishing", but oil declining faster than viable alternatives (plural) can replace it. It will be challenging but not impossible.
No Zac oil will not just vanish. But unless there is dramatic change to the politics that oversees its availability, to some sectors of society, it might just as well simply vanished, because it will be out of reach. It will be another 'wealth gap'. Will there be something to replace it? I don't know. It may just be used to control a section of society to keep them compliant. That's the overriding politics.
Murray - this is so important a point that I'm going to call BS. (edit - on the energy/tech point, not the rest)
Politely - but BS.
The genre-flip rendered the comment invalid. It is very important to understand that.
Try something this weekend: try not putting energy into your piece of technology (don't eat anything). See how it goes.
Thy not putting energy into your tanks, or your batteries. See how far you get.
Technology IS MERELY THE EFFICIENCY WITH WHICH WE TURN ENERGY INTO WORK. It doesn't create the dam-ed stuff, OK?
Peruse this, carefully: Energy Blindness - The Great Simplification (I think it applies :)
Put yourself through this: Programmed to Ignore? | Do the Math I'm seriously interested to know if you figure (I'm increasingly sure you don't - not surprising @4%).
Then make the time to watch the link I put upthread - and do so without pre-prejudice.
Cheers
Take another read of the last paragraph PDK. What do you think I was talking about?
To spell it out for you, it is politics that ensures (or denies) that energy in some form is accessible to all corners of society. As oil availability declines with no affordable and viable alternative source of energy for the lower sectors of society, there are parts of the economy that will be at serious risk of collapsing, because some will be denied the opportunity to participate. (I expect social welfare will be too expensive). That division will produce societal tensions that have caused previous civilisations to collapse. So whether or not you agree or like it, sitting over the top of all the energy equations you're so fond of is politics. The rich and powerful, politicians or not, will use power and control to restrict the last of the oil based energy for themselves and their own. A few may work to try to create an alternative for the masses, but history teaches us that it is more likely the masses will rise up to take what remains for themselves, essentially accelerating the final decline. Nukes may even play a part.
Who said the brief was: to get energy to all corners of society?
The driver is the available energy.
Politicians can influence who gets what remains of it (indeed always have) but that is secondary, not primary. in Systems terms.
I have no problem whatever with your socio-political appraisal, though - it can play out not many other ways (financial collapse removes the 'rich and powerful' markers, of course - what do the 'pay' who with to do what., thereafter?)
PDK, I interpret Murray's comments in relative terms. There will always be fossil energy in the ground, its the economically extractable that determines availability.
Economics is a social science. It considers how people act. The $/£/€/¥/₩ flow element is just an objective measuring tool. As a social science, it is inherently political.
Other science disciplines measure the socially driven impacts on planet earth and all those life forms that inhabit it, that arise from the extractive system. Politics is the mediator of the societal structure that governs extraction, distribution and access.
Societies strength is through their cohesion, not division. Wealth and privilege gaps undermine societal cohesion and result in increases in crime and violence. The scenario you paint around the decline of energy availability (which I essentially don't have a problem with), forces the inclusion of energy as a component of either or both wealth and privilege. The loss of energy from fossil fuels, without a viable, affordable alternative for the lower echelons of society, will inevitably lead to increased societal unrest. Human history has many such examples where such gaps have led to revolt, rebellion and revolution. The process is ugly and the outcomes never certain.
A government's role is to ensure the circumstances laid out above don't happen. This is achieved by ensuring everyone has access to and the ability to use all the different resources used by that society. And that includes energy. Nothing is for free though, and those lower classes have responsibilities to contribute. Energy be it from 'clean' sources or FFs must be a part of that equation.
The down sides are population numbers and consumption beyond the resources finite limits and what the environment can sustain. Everything is connected.
Murray86 has a better grasp of logic and science.
That food sits in the ground if there is no energy to extract and move it.
"U.S. Treasury Secretary Scott Bessent on Tuesday said China had been an unreliable global partner during the Middle East war by hoarding oil"
https://www.japantimes.co.jp/business/2026/04/15/economy/bessent-china-…
If global meltdown wasn't just around the corner, this could be a comedy sketch. The tone deafness is off the charts. Bessent has apparently appealed to China to release some of it's enormous stragegic reserves to stabilise markets. A war started by the US and Israel. Chinese reserves being around the 1.3billion barrel mark.
China has been busy buying up sanctioned oil at budget prices, helping to prop up the finances of several despotic regimes, including Russia and Iran. So no ethical brownie points there. For the moment China is alright Jack.
Reinforces the point I made above doesn't it?
From all appearances China is in control as much as its major, for want of a better word, rival the USA is out of control.
The S&P 500 and Nasdaq Composite rose to fresh all-time highs on Thursday
https://www.cnbc.com/2026/04/15/stock-market-today-live-updates.html
Lemmings betting.
What does that prove?
All that debt has to find a home somewhere.
Amazing (and perhaps irrational) given the current circumstances. There used to be big sell offs during times of conflict and uncertainty. Not these days. Maybe it's just shear complacency.
Or perhaps its our local perspective. Our anti US bias. Or the fact we dont have a horse in that race. Where would you put your money in a global crisis. Investors are backing US.
WithHH. You appear to have taken the int.co site tag line 'helping you make financial decisions', literally. Naive of you I'm afraid. It's actually mostly a doomscroller end of life as we knew it journal.
And money is to buy?
Fixate on the proxy by all means
Some of us study the underwrite.
all while utilising and enjoying the outputs of the system we so deplore
Naive of you I'm afraid. It's actually mostly a doomscroller end of life as we knew it journal.
Haha. Perfect.
Which is why I read it most every day and happily pay my subscription.
And it is a much better quality of doom and complaining than talkback radio.
The cognitive approach taken there, is to belittle with a valueless throwaway derogatory comment.
Then to us that to, in relative terms, raise the writer's own appraisal of their self-held opinion, vis a vis that which they are denigrating. Having done so, they can triumphantly claim superiority, while having avoided addressing something they - deep-down - know they'd not like to know.
A very common - and very obvious - approach.
Jesus you’re a hypocrite.
Something has to counter the mindless optimism bias
Well, you can be optimistic or pessimistic about the end of the world. It’s your choice.
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