Here's our summary of key economic events over the weekend that affect New Zealand with news expectations of an imminent resolution of the Persian Gulf standoff have stalled. Iranian officials have reversed reopening the Strait of Hormuz after the US refused to end its blockade of Iranian ports. Ships attempting to cross the Strait of Hormuz have been fired on.
This is expected to weigh on financial markets when they open later today.
This week locally will be all about the March quarter CPI which will be released on Tuesday. Because most of that quarter didn't see the oil price spike until March, markets expect a 2.9% quarterly rate, slightly less than the 3.1% rate in Q4, 2025. It is a data series that really needs to be released monthly. It will be preceded by trade balance (today), and followed by the QSBO and an update on productivity.
In Australia, there are no major economic data releases, although we will get a flash report on their April PMI.
In the US, apart from earnings updates, they too will get a flash April PMI, and confirmation hearings for Kevin Warsh will put this billionaire in the spotlight.
In China, PMI results will also feature in a light data week. In Japan, it will be about March trade data and retail sales. Central banks will review their monetary policy settings and rates in China, Malaysia and the Philippines this week.
Over the weekend, Iran confirmed what most people understood - Trump was 'claiming victory' without any deals in place, and that is making ship transit of the Straits of Hormuz hazardous again. It looks like the progress claimed was a mirage.
In Canada, small business sentiment rose in April, an unexpected shift but likely due to local election results. The trade group that does this survey says it is still weak, but it is actually back to the levels that prevailed prior to the pandemic.
But Canadian housing starts sagged somewhat in March, coming in below February levels and what was expected. But they are now +6.9% higher than year-ago levels.
Indian loan growth reached +16.1% in the year to March according to official data released overnight. That is the fastest pace they have recorded since they started tracking this metric in April 2025.
In China, their construction machinery sector rose strongly in March with excavator sales up nearly +30%, of which domestic demand was up almost +24%.
Malaysian CPI inflation remained tame in March, up just +1.7%, although that was their highest rate since the beginning of 2025. They also reported that Q1-2026 economic activity rose +5.3%, and slightly less than the +5.5% expected.
Meanwhile, Singaporean exports were up +15.3% from a year ago, their second fasted monthly rise since mid 2024.
The UST 10yr yield is now just on 4.24%, down -1 bp from this time Saturday and the same for the week. The key 2-10 yield curve is still at +54 bps. Their 1-5 curve is still at +20 bps and the 3 mth-10yr curve is at +58 bps. The China 10 year bond rate is now at 1.77%, up +1 bp. The Japanese 10 year bond yield is unchanged at 2.42%. The Australian 10 year bond yield starts today at 5.00%, up +2 bps from Saturday. The NZ Government 10 year bond rate unchanged at 4.71% down -2 bps for the week.
The price of gold will start today down -US$28 at US$4829/oz. Silver is down -50 USc at US$81/oz.
American oil prices are down -50 USc at just under US$84, while the international Brent price is also down -50 USc, and now at US$90.50/bbl. These new levels are down -US$12 and -US$4/bbl respectively. The North American rig counts fell again. Tonight, all eyes will be on the IEA's April update of the global oil situation.
The Kiwi dollar is down -10 bps from Saturday at this time at 58.8 USc, up +30 bps for the week. Against the Aussie we are unchanged at 82.1 AUc. Against the euro we are also unchanged at just on 50 euro cents. That all means our TWI-5 starts today also unchanged from Saturday at just over 62.2 but up +20 bps for the week.
The bitcoin price starts today at US$74,842 and down -3.0% from this time Saturday. A week ago it was US$72,976. Volatility over the past 24 hours has been modest at just on +/- 1.1%.
[There will be no video version today.]
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29 Comments
Another week, another flood. It never rains, it pours.
It was amazing to see the global 'ah, back to normal' linear-thinking brigade, early in the weekend. Funny as a fight, if you'll excuse the pun.
There we had a President with a well-demonstrated inability to differentiate fact from fiction - and clearly failing mentally - issuing tweets on a private account - and being near-universally believed.
In reality, the US has attacked Iran multiple times now, while talks were in progress. The US instigated this problem; the Straights were so open before it that most people couldn't have pointed to them on a map or chart. We can assume that the US therefore didn't want the 'peace talks' to be real ones. The US was therefore always going to keep up its blockade. So far so obvious.
And the Iranians were going to accept that blockade-but-only-on-one-party? Bollocks they were.
Yet the number of people - media, share-bettors, although I noted political caution - who thought things were 'returning to normal'. How a 30% reduction - via direct damage and season-implication dearth - of fertiliser could be regarded as 'normal' by an overshot species which has never bypassed the need to eat, is..... interesting.
Confirmation bias is perhaps something we need to be aware of.
Yes I had to wonder at that a little. There is no certainty other than more chaos driven by Trump, but people are moving on without solutions. Temporary dips in the price of fuels are red flags, not signs it is over.
Hard to know what he’s thinking. He makes a deal, then reneges on it, then tries to make another. I can only conclude it’s a ploy to look like he tried to negotiate and it failed so now he has to bomb them. Either that or he wakes up with a different personality each day, that does seem to be the case.
Not that hard.
Firstly, he's a child - a 'concrete thinker'. Manifests early as 'if I can't see it then it doesn't exist'. Most of us grow out of it.
Secondly, he has no ability to read the room, to read body-language, to grasp nuance.
Thirdly, he (and his) have a playbook based on populism - but populism has trouble when it fails to deliver - then it has to blame, or at least, blame-shift.
Then there is the Zionist layer - the legacy of all the Kissingers and Wofowitzes in the US - and Netanyahu using the child as a puppet.
Then there is the oil/energy depletion angle - China may look like the biggest consumer, but the US consumes the biggest portion of China's exported production and last I checked, was the biggest resource-consumer - 5% of global population and roughly 25% of global resource consumption. Fracking was a one-off phase, and somewhere in the US will be brains carrying the knowledge that the Middle East and Russia are about the best of the rest - Venezuela and Canada are not in that league and everything else is too minor or too fraught to be worth the effort. Whether Trump grasps that or is in thrall of the oil folk who do, is hard to tell.
He isn't the first to use propaganda re the ME, either; to call others terrorists, evil, communist etc has been a US hallmark for decades - indeed Hegseth reminds me of McCarthy; history rhymes.
As to your last point - how does he explain away destruction of civilian targets to an already-skeptical support-base? How does he exit? And what damage would Iran inflict to oil/gas infrastructure - and therefore to the global 'economy' - as retaliation? You could forget global growth - it would never recover (and likely won't anyway).
Trump isn't conducting 4D chess here, he's merely practicing that well established despot tradition of "flooding the zone", and it works. Markets hang on his every word like they're jewels from heaven, as do media, although in fairness, he has culled the press core down to gossip rags, entertainment and supporters, while the rest are scared of litigation and regulatory induced extinction.. Lots of people getting rich off the great mans jaw boning generated volatility, especially the ones sitting around his cabinet table, and dining table. There's also an element of terror in his press releases of victory. You can only gaslight your supporting cult so long that the prices paid at the pump are an illusion.
“All tyrannies run on fraud and force, but once the fraud is exposed they must rely exclusively on force.”
- George Orwell
Chairman Mao said bluntly and accurately- political power grows from the barrel of a gun. The Iranian Republican Guard has all the guns, lock stock and smoking barrel, they were always right at the top quarters of the Iranian administration and now they are the top. That is what the Americans are now up against and they are a great deal more bolshy than the political hierarchy that the Americans and Israelis assassinated.
Always?
Too short a window.
Ask why and when they evolved?
Again: Always?
Yes always, since 1979 when Ayatollah Khomeini assumed power and put into place the apparatus that would keep the regime in power. Control all the guns and control all the people. The war with Iraq was opportunity to cull and condition the military accordingly to the point whereby not much happened in Iran without that input in the form of such as the late general Soleimani. The IRG was formed, modelled and purposed for exactly the situation of the of today, control the streets, protect the regime. Hate to make the comparison but the closest body of military in format and design of duty is the Waffen SS.
Yes always since 1979, is an oxymoron.
And you know it.
:)
People need to understand that PDK is working with geological or even cosmic timescales. The rest of us mortals are working with human timescales.
Considering there was no such body prior to 1979 the point surely speaks for itself. As a matter of interest illustrating the evolvement a quick search AI or whatever indicates the late General Soleimani at the time of his death as having been the second most powerful identity in Iran.
by Zachary Smith | 18th Apr 26, 10:48am
It must be a disappointing day for the promoters of the collapse narrative.
I hope Zachary and the six people that liked his comment got enough celebration time in over the weekend.
Both teams are celebrating victory before the war is over.
In my defense I didn't mention anything about victory, just commenting on the news of a market surge. This shortage is still geopolitical. Things will work out. There, that's my prediction. It's pretty obvious things will go back to normal once things settle.
"Things will work out"
But for who is the important question....
I wonder what thew new "normal" will look like? My prediction, is not like the old normal.
Yeah, that was my comment Zach was replying to. Just to be clear, I wasn't celebrating anything. Merely stating the obvious based on previously established facts.
Yes Time Lord - my thoughts entirely.
The fierce need to believe is strong in some.
We all have the tendency - I had it knocked out of me by many miles of offshore sailing; 'I wish' tended to be displaced by 'I need to deal with'.
Less to deal with if you reef before dark...
Watch the Radar for rain fronts at night
Intermittent reality hitting home for the German Minister for Economic Affairs and Energy.
"One fact has been concealed for too long: an energy transition that ignores system costs will ruin the country that it pretends to save.
It can't go on like this. The renewable industry has grown up and now has to take responsibility – systemically and financially. By 2035, system costs will rise to 90 billion euros a year. The problem is structural: we have shut down 20 gigawatts of secured, low-carbon nuclear power. In addition, there are massive, politically driven network investments and a market design that ignores reality."
https://www.faz.net/aktuell/wirtschaft/katherina-reiche-jetzt-ist-zeit-…
"Alternatively, Germany could have kept the existing nuclear power in 2002 and possibly invest in new nuclear capacity. The analysis of these two alternatives shows that Germany could have reached its climate gas emission target by achieving a 73% cut in emissions on top of the achievements in 2022 and simultaneously cut the spending in half compared to Energiewende. Thus, Germany should have adopted an energy policy based on keeping and expanding nuclear power."
https://www.tandfonline.com/doi/full/10.1080/14786451.2024.2355642#abst…
Agree (for once). Nuclear is not the problem, it’s actually a big part of the solution.
A tout, and a person who believes in money.
Hmmm
As I often point out, money is not the measure. Energy is. In that light the discussion is valid, but needs to be preceded by another; what societal construct can be maintained using electricity? That includes of course, within one reiteration, the ability to build itself.
And if nuclear - proven tech, not magic - displaced/replaced fossil, how long would it last (being based on a finite resource and dissipation being an energy question).
Money talks. For example, fuel has gone up by 30% or so, and all of a sudden people are investing in electric cars. If it went up another 30% and looked permanent, EV cars / buses / trucks would increase significantly. The same thing occurred with the clean car discount (by EV price reduction).
"how long would it last" - hopefully until the next big energy technology is proven. And hopefully that one is renewable.
Your last sentences are not those of an engineer.
And certainly not of a physicist.
Exponential Economist Meets Finite Physicist | Do the Math
Nothing in JJ's comment contradicts physics or engineering.
Trump and his cronies have found the forever money hack by shorting oil right before each Trump announcement the Strait is open for business again.
Great incentive to keep the Hormuz thing going while juice can still be squeezed out.
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