Here's our summary of key economic events overnight that affect New Zealand with news that although the US claims the ceasefire with Iran is holding and "ships are lining up to transit", in fact, very little is moving in the area between Iran's red lines. And the most high profile transit in the past 24 hours was an Iranian tanker. Still, the US claims resonated on Wall Street, and stocks rose, benchmark rates fell.
But first today, there was another full dairy auction earlier today, a small one where volumes offered and sold were the least in fifteen years, since mid 2011. But prices were up +1.5% in USD, up +1.6% in NZD. Butter prices continued to slide, but there were good gains for SMP, WMP and mozzarella. These gains end two consecutive full events where prices fell.
US job openings fell, although to be fair, but less than expected. But even then, they are back at levels they had in April 2018, which is less than it seems because their labour force is so much larger now.
There were two services PMI reports out for the US overnight (ISM and S&P Global) and both showed that new business intakes fell for first time in two years as war in the Middle East and inflation hit demand. But both were positive even if less so that in the prior two months.
The reason for the retreat can be found in the latest April logistics managers report, where freight costs leapt, taking this index back to pandemic-stress levels.
The US RCM/TIPP economic optimism index fell yet again, down to levels last seen in early 2024. It has retreated steadily since December 2024. It's sponsor's report called it 'steady' but that is gilding it somewhat.
US exports and imports were little-changed in April, but both are in rising trends even if imports rose slightly more than exports (which rose largely on petroleum exports). Their trade deficit has widened.
Canada also reported export data and that came in at a one year high, and unexpectedly good result, largely on the back of high exports of petroleum and gold. Imports fell back in April but from an unusually high March level. The result was a good trade surplus, their first since September 2025.
Singapore reported March retail sales late yesterday and they were better than expected with a good +4.8% rise from a year ago. That represents a real gain because their CPI inflation was 1.8% in March.
As widely anticipated, the RBA raised its cash rate target by +25 bps to 4.35% late yesterday. It was a split decision with one voting member wanting to hold the rate unchanged. But they face sharply higher inflation threats that seem to be growing and prior rate hikes have done little to quell those. However they have restrained their housing market enthusiasm and this latest hike is expected to put the brakes on that further. Traders still believe there is at least one more rate increase this year despite the RBA saying their policy was still only mildly restrictive.
This comes after the March CPI rose +4.6%, and yesterday they reported that household spending remained high over the year in nominal terms, up +6.3% compared to March 2025 (and the highest since January 2023). Most of this is 'price' and much of it relates to a +32.8% increase in monthly fuel prices. But in volume terms, they say fuel purchases are lower, down -1.3% in March from February.
The UST 10yr yield is now just on 4.42%, down -2 bps from this time yesterday. The key 2-10 yield curve is now at +48 bps (unchanged). Their 1-5 curve is now at +32 bps (-1 bp) and the 3 mth-10yr curve is at +76 bps (-2 bps). The China 10 year bond rate is now at 1.75%, unchanged. The Japanese 10 year bond yield is also unchanged at 2.50%. The Australian 10 year bond yield starts today at 4.96%, down -6 bps. The NZ Government 10 year bond rate is down -1 bps at 4.68%.
Wall Street has started its Tuesday with the S&P500 up +1.0% and a new record high. Overnight, European markets were mixed between London's -1.4% drop and Frankfurt's +1.7% rise. Yesterday Tokyo was closed for a holiday. Hong Kong was open and was down -0.8%. But Shanghai and Singapore were closed for holidays. The ASX200 ended down -0.2%. And the NZX50 ended down -0.5%.
The price of gold will start today up +US$37 at US$4559/oz. Silver is unchanged at just over US$73/oz.
American oil prices are down -US$3 at just on US$102/bbl, while the international Brent price is down -US$3.50 and now at US$110/bbl. It is hard to see these prices easing further given the sharp fall in global oil reserves recently. Even the future process of building them back will add to demand and prices.
The Kiwi dollar is up +20 bps from yesterday at this time at 58.9 USc. Against the Aussie we are up +10 bps at 82 AUc. Against the euro we are up +20 bps at just on 50.4 euro cents. That all means our TWI-5 starts today at just under 62.3 which is up +20 bps from yesterday.
The bitcoin price starts today at US$81,300 and up +0.9% from this time yesterday. Volatility over the past 24 hours has been modest at just under +/- 1.3%.
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65 Comments
Fool me once, shame on you
Fool me twice (Trump voters), shame on me
Fool me every day (markets), shame on who?
If you’ve ever met a compulsive lier, it can take a while to know, but once you know it explains everything and you never believe a word they say again. Which lie is Trump going to go with today? Is he going to bomb the crap out of them, or get the US an amazing deal? Or maybe shift the focus with a German tariff
Nothing new. That’s what the Americans got the first time and that’s what the Americans voted for a second time. Like it or lump it, that is the reality. It is not even halfway through the second term.
Many of them would vote for him a third time if they could. Maybe there should be a basic IQ test on the voting form.
There should be a basic test on many things.
The ability to read, comprehend and learn, would be the first that springs to mind.
Using that, one can understand that Trump is a symptom, not a cause.
One would therefore do some delving into what might be the cause?
And look in wonder at those who need to not do so.
Good comprehension - my better-half was involved in teaching 'critical literacy', anathema to neoliberal dogmatics - can be had sans high IQ. In a delicious irony, those with high IQ realise that...
You could read all sorts of causes that are plausible.
Many believe the cause is that the average American is doing it tough, yet a simple peek at their waistlines would say otherwise.
We all know what you think the cause is.
Interesting implication.
'I am part of the majority' .... 'he isn't' ... 'therefore I am right'.
Key giveaway: 'we'.
"waistlines" Too many calories, too little nutrition. Symptom of poverty.
America must be the poorest country on earth
You'd call it more, inequality.
https://www.census.gov/newsroom/stories/poverty-awareness-month.html
Trump would fail it. Likely a few other Presidents too; LBJ, Bush Junior are just two who come to mind.
Perhaps that part of the greater scheme? Colin will like this, but the only ones who get to run for the Presidency have to pass a malleability test. Essentially they have to fail a spine, intellect and will power test and be subject to manipulation by select groups or people.
Exactly Murray, you’re getting it now. Trump, Bush Jr, LBJ, are merely constructs with a role to play. Their egos lack the capacity to overpower a government or country unless their puppet masters desire that be the plan.
If they had a spine, intellect and willpower they would not qualify to be placed into the role.
Also a reason to remove JFK.
CIA and organised crime groups colabbing to create the world they wanted.
Sticking around for six assassination attempts doesn't show spine?
People are funny aren't they. Getting shot at, apparently no big deal. But a tricky looking staircase? Terrifying.
https://www.bbc.com/news/newsbeat-38802648
In his physical state I guess the two threats are pretty much head-to-head in terms of odds of finishing him off.
Disturbing how casual the left are about political violence.
"I could stand in the middle of Fifth Avenue and shoot somebody, and I wouldn't lose any voters, OK?" DJT
January 6th.
Hey, give them a break. They're new to it - the right have dominated political violence for decades.
Notice how they've buried everything about Thomas Crooks? He doesn't even get mentioned in 2026. Even Trump himself has no interest in his shooter.
Not all is as it seems..
And the latest attempt at the WH correspondents dinner? Come on that was pure theatre.. "shots will be fired"
My take is that obduracy and vanity of Biden and the laxity and stupidity of the Democrats in general, gave Trump a substantial helping hand.
You have a right-of-centre cranial starting-point (often visible :)
All US politicians are captive of the corporatocracy; you cannot get there without that kind of money.
What voted for Trump were these folk: I Traveled A Lonely, Two Lane Black Top To An Amazing, Never Before Seen Part Of Indiana
And they did so because they remember what they were 40 years ago - and aren't now. Blaming what most fits our personal narrative is the usual pathway, but good thinking demands starting from a neutral/dispassionate POV.
Delve and pontificate as deep as you like, but regardless of any bias or heritage, the fact is that the Democrats cocked up the selection and the election, full stop.
Biden / Harris were stupid for not being as stupid as Trump. Thats the unfortunate reality, the average voter doesn’t vote for what they want, they vote for what they don’t want. And in this case they didn’t want someone smarter than them being in charge, so they voted in the village idiot.
The average American would obviously have been better off with Harris in charge, it was an absolute no brainer. Unfortunately no brainer describes the average American.
They vote for what they can get out of it. That sets a contest between the two parties that concentrates on gaining power with what they are actually going to do a distant second but the first thing that is going to be done is to start filling the trough for all the snouts of the party faithful all the way down the line. That is what they vote for. The complete opposite of JFK’s “ask not speech.”
ps : As an example. We lived & work there when reasonably turbulent 911 & Bush junior presidency. Our attorney was very wealthy and owner of a renowned horse racing stable and stud and a long standing member of the state senate. He was intrigued about NZ , horses mainly, and got to know and quite like him. Halfway through the term he switched from Democrat to Republican. When talking about it became very clear that he had been persuaded that his patronage would be far better rewarded by the latter. Backfired though, he lost in the next election.
I don't know if vanity was a Biden strong point? Trump OTOH, if you took the vanity out of him, there'd only be a wrinkled orange skin left. I don't remember Biden AI'ing himself as Jesus? You're correct about the nature of the Dems though.
Didn’t really mean in the vainglorious sense. Perhaps hubris might have been the better word. What I am getting at is that having tried for so long for the presidency that once got, he couldn’t bear to let it go and, with apologies, to resort to a sense of vanity by Chambers - “folly or futility.”
"he couldn’t bear to let it go".
To be fair, Biden was pretty fragile by the end of his term. My take, Dems were so scared of making a wrong move and letting Trump through the gate, they were contemplating a "Weekend at Bernies" scenario. In the end they realised someone might have noticed Joe decaying a bit a year or two into the term. They were probably hoping Joe could have remained on his feet long enough for an election win and then have Harris take over. We know how that turned out Foxy ;-)
It goes back a bit further too. In the primaries for the 2024 election by the time of New Hampshire, Harris was out as seen as unelectable and Biden had given up. Then the Dems suddenly realised in fact he was the only one they had that was electable. Thus resurrected he went forth and won it for them. They had three years or so then to establish a worthwhile replacement but failed to do so even though Biden’s decline was obvious and accelerating. Harris of course remained unelectable and still is.
I'm no expert in knowing every figure involved in US politics, but I have seen a few of the Dem contenders and they're such grey, dull people. Surely there's a competent individual with some sort of personality buried in there somewhere. Someone with a bit of passion and fire. I guess Newsom is trying? Even Joe with dementia had more personality than most of them.
Leaving aside competence and policy my theory is that the last of the let’s say Presidential quality was Bush senior. The downside in integrity and demeanour commenced with Clinton. That coincided with the arrival of a far more intrusive and aggressive media. The worst scandal about Bush senior was his dislike of broccoli. The loss of Presidential stature and status takes with it loss of confidence and increased division and now even worse the Justice system is being politicised and comprised.
Odd that you say a more intrusive media began under Clinton? You'd think he'd be their darling, having given them the Telecommunications Act?
Well early on the Whitewater revelations and accusations made for good headlines but dwarfed later on, and mightily so, by the case of the unfortunate and forsaken female intern, and resultant impeachment. Seemed to be that that President thought to emulate the activities and impulses of his hero figure JFK but found things out there, weren’t as discreet as they used to be
Yeah, the press wouldn't let that bone go, if you'll excuse the pun.
He's going to do both. The only doubt is which one first? And then he will up the German tariffs, just because he can! Don't you understand how much fun it is to be the most powerful ......... in the world? (find your own dysphemism, or series of them)
The most surprising aspect is that he hasn’t gone with the bomb the crap out of them option yet. It must be weighing on his ego. Or maybe he loves himself so much he doesn’t need an ego.
This is a dying hegemony. It has, on the balance of probabilities, blown up the Nordstream pipeline. It has sided with Israeli genocide. It was in Maidan, prodding the bear. It invaded Iraq, on false pretext, twice.
So we must at least ask the question: Are the missiles hitting the UAE (which just left OPEC, BTW) from Iran? Iran says no, but I don't initially believe either, these days. On the law of averages, the US is hurt less by UAE damage, than China.
Iran targeted UAE the site that diverted oil avoiding the Straight, potentially removing 2mbpd from global supply. All good though, just heard Rubio officialy stated offensive hostilities were over. The Trump admin must have filled their buy orders.
https://time.com/article/2026/05/05/rubio-iran-epic-fury-over-strait-ho…
The Ukrainian Euromaidan occurred in response to president Yanukovych's unilateral decision to take the country closer to Russia, against the majority opposition of parliament and the people who wished to move closer to the EU. The largest popular mass movement protest demonstrations in recent European history followed. Undoubtedly the US would have been influencing public opinion but to characterise this as 'poking the (Russian) bear' which was aggressively seeking to reassert control of sovereign Ukraine by fair means or foul, is misleading. The vast majority of Ukraine citizens wanted freedom.
But, but, Nuland, Hunter....... if the protesters knew of their existence.
Those Nuland cookies must have been mighty good to risk being shot in Maidan Sq?
Can't quite figure PDKs soft spot for the empire building killer in the Kremlin?
Perhaps he has a left-of-centre cranial starting- point (unfailingly visible.)
Thing is, Putin hasn't got a leftist bone in his body. Sure, he uses soviet nostalgia to manipulate the proletariat, but that's only to further the interests of his gangster capitalist state.
Vlad Vexler sums up the failings of the leftist view here.
FG. Poor effort. With a bit more thought you could surely have worked in an entropy or two, maybe a digital keystroke issued, certainly a species over shoot.
PT08. Biden junior enters the UKR stage largely after Euromaidan. But even if the murky accusations about him are true they would pale to insignificance in the face of Ukrainians visceral fear of reliving the nightmare of suffocating Russianisation. You jest about the Nuland cookie affair. It's even more comical that Putins propagandists seriously presented this light hearted, if ill judged, stunt as a US attempt to wage war on Moscow.
"Can't quite figure PDK's soft spot for the empire building killer in the Kremlin?"
Well, I can Palmtree... PDK possesses the necessary IQ to enable him to figure out who the enemy of humanity really is.
The idiocy of comments like this, and with Foxglove chiming in and trying to frame this situation in left/right nomenclature, is IMO, a very sad case of pseudo-intellectualism.
There's a few enemies of Humanity out there Colin, not just one. Doesn't take much IQ to understand V Putin and his merry band of genocidal cronies are right up that list.
Humourless overreaction. After all if Foxglove can take it on the chin as being leaning right of centre pdk is quite capable of defending that he is leaning likewise, but leftwards . Lighten up, fgs!
"The vast majority of Ukraine citizens wanted freedom."
Oh... "Freedom" - do you mean, Middleman, the CIA/MI6/Mossad/Economic-Hitman brand that served the citizens of Iraq, Libya, Syria, etc. so splendidly?
Ah well, Russia has made sure there's no freedom from violence in Syria and Libya. The Russian idea of peace is scorched earth and deporting survivors to Siberia. I'm sure you'd enjoy living in an authoritarian regime though Colin.
Interesting that you don't/can/t step back one, and ask why?
Why what PDK? Why does Russia feel it needs to project it's influence?
It's simple really. Grievence among Moscow elites who still hold the view they have a birthright entitlement as a global player. When the Soviet Union broke up the Republics couldn't wait to gain their freedom from Kremlin management. In the process Russia lost something. The prestige of being the centre of empire. Their big swinging dick ICBMs must mean they're important right? Grievence, entitlement, manipulation. The average Russian couldn't give a damn what the Kremlin does. They outsourced their political rights as citizens in return for being left alone by the state, something Russian society had never experienced. Problem is, Putins ambition grew like a cancer and now this outsourcing has come back to bite.
Classic example of the well worn saying "You may not be interested in politics but politics is interested in you"
Putin believes he is Russia and it's not big enough for him.
PT08. I'd challenge the view that Putin is driven entirely by acquisitive imperialism or simply a desire to restore the empire and thus create his legacy of being a great Tsar. This is also a divinely ordained quest to roll back the ravages of western secularism and restore the spiritual supremacy of the great orthodox christian god.
If Putin believes he's doing "gods work" exterminating Ukraines population, it's a later development. I tend to think he's utliising the Orthodox church as a useful tool in much the same way Stalin did. The church is a tool of the Russian state rather than independent organisation spreading goodwill and love of Christ. It's a popular theme on Russian propaganda TV that everyone opposing Kremlin expansionism is a satanist.
PT08. I know it seems counterintuitive to view the apparently nihilistic gas station gangster as having a spiritual dimension to his warped makeup but keep in mind that divine authority was the foundation stone of the Tsars authority. He was an agent of gods will. Bakunin the 19th century revolutionary wrote that the Tsar was 'a kind of russian christ'. Russian expert Orlando Figes believes this spiritual element remains part of Putins motivating rationale.
Just over 300 years ago Peter the Great swept aside the Swedish Empire and established the Russian Empire in its place. Putin has been more than overt in claiming right to repossess all that territory. Peter the Great, Putin the Great, does rhyme and resonate rather well doesn’t it.
I know Russians have quite a unique cultural perspective. They certainly have a layer of superstition that isn't really present among mainstream westerners. Yes, I also understand Putin invokes a sort of mysticysm around his claims of Slavic brotherhood. I remember Putin being videoed during a church visit during Orthodox Easter(?) a year or two back. He was busy lighting candles, wearing a rather unsubtle bullet proof vest. Obviously doesn't believe in leaving everything in Gods hands?
The hot mic incident with President Xi where they were caught discussing extended life spans would indicate sad Vlad is feeling his mortality.
"With advances in technology, Russia’s Vladimir Putin assured Xi Jinping via his translator that “human organs can be constantly transplanted, to the extent that people can get younger, perhaps even immortal”.
https://www.theguardian.com/world/2025/sep/05/healthy-living-science-do…
Guess he's having a Rouble both ways? :-)
Colin. I doubt they looked as far afield as those countries. Their focus would have been closer to home. Things like never being subjected to another Moscow engineered Holodomor killing millions of Ukrainians.
It's another false flag, PDK.
I think we can say with certainty that the UAE strikes did not come from Iran.
We need to ask what entities have an interest, or at least imagine they have, in escalating this war. Iran categorically does not.
Apparently, imbeciles such as Nuttyahu, Hegeseth, and Lindsey Graham, still believe that one last big push will break the Iranian resolve, and that they will promptly hand over their national sovereignty, resources, and civilisation to War$hington.
This, in some respects, is Afghanistan revisited. It took ~$2.3 trillion, and twenty years of bitter war for the US to replace the Taliban... with, ummm... errrr... the Taliban. The only benefactors being the MIC and, of course, the very best politicians that money could buy.
In the process, more than 176,000 people lost their lives, including 2,459 US military personnel.
Another ~2-300,000 people were seriously wounded.
A war with Iran, a natural fortress-like country, of almost the combined size of France, Spain, Germany and Italy, and a population of more than 90 million people, will be a much more horrendous bloodbath than Afghanistan or any previous foreign escapades.
Colin. It's illogical to insist 'with certainty' that that the UAE missile strikes did not come from Iran. With all parties engaging in a propaganda war about what is really going on there is no way of being 'certain' about any such events. While on the topic of logic, there is around 50K US service personnel deployed. So clearly no substantive land war of the type you discuss is being contemplated. Comparisons with Afghanistan are largely irrelevant.
Says a lot about what the Dems were offering I guess? More of the same techno utopian neoliberal globalist mass immigration and erosion of the way of life they enjoy?
What they expected from Trump either shows extreme naivity, ignorance, or vacuous wealth worship. He gave them abortion bans and that's all many wanted really. The rest could crumble, and is.
It's easy for NZers to ridicule the US situation, but Trump is a symptom of decades of no choice between their corporate owned political establishment. To become a functional democracy the US needs to break up! The bigger the institution, the deeper the rot!
Well said
It's easy for NZers to ridicule the US situation, but Trump is a symptom of decades of no choice between their corporate owned political establishment. To become a functional democracy the US needs to break up! The bigger the institution, the deeper the rot!
Yes, this sums up the US situation pre-Trump. Just a shame that someone like Trump had to be the disrupter, of all other possibilities.
Disruptors are, by definition, out-pirates (Buckminster Fuller).
MbZ HAS MADE HIS BED - now he must lie in it.
First up, the headline..."Hormuz still shut despite US claims..."
No, it is not closed. It remains open to all traffic that complies with the Iranian/Omani transit rules. The US "blockade" has only managed to halt a single-digit percentage of Hormuz traffic.
Given the increased price and volume of Iranian exports, their receipts are likely up 300-400% compared to their pre-war trade figures.
MbZ (the president of th UAE, Emirati Royal, and ruler of Abu Dhabi), an extremely dodgy character, bet on the US/Israel Axis protecting him as the UAE goes to war against Iran - this may not go well for him.
The Iranian blockade of Hormuz includes Fujairah - only two of the Emiratis are playing this dangerous game, Abu Dhabi and Dubai, the other 5 states of the 7 are not.
This is a huge call, as on May 1, the UAE officially left OPEC/OPEC+, the 23 countries that control the price/supply of global energy markets. This could be huge - just imagine if multiple OPEC countries took the cue from the UAE and literally flooded the market. A classic case of the old cliche'..."The best cure for high oil prices... is high oil prices."
And the UAE did this, thinking that they could sell more oil, whilst the price is high, but having gone to war against Iran, how on Earth do they think they are going to export at all, let alone at higher volumes?
Given that this move could inspire other OPEC countries to leave the cartel, especially those that retain the ability to quickly open up their spigots, plus are not blockaded from exporting, this could turn out to be terminally disastrous for the UAE.
Not only will they not be able to export, being at war with Iran, but the price of oil could drop massively before they ever get to export in any meaningful quantity again.
Meanwhile, the UAE is desperately trying to balance its budget using a reputed $20 billion dollar U$ swap line. This is through the US Treasury, which is not the usual channel, IOWs dah Fed - this means that this new type swap line facility* is, by definition, a politically motivated decision.
*(the only previous example I can think of, of a Treasury facility swap line, was the $20 for Argentina, to help get their Wall Street lackey/Netanyahu fanboy, Milei, reelected as President)
My Translation/predictions...
#1 This is more U$ money-printing/QE on a global scale, as opposed to it being done within the domestic domain.
#2 The weaponisation of the U$ dollar just went on to even more steroids.
#3 The purchasing power of the US dollar will be diluted at an even more rapid rate.
#4 Mainstreet America will find the increased cost of living intolerable, and the GOP will lose both houses in the midterms, opening the door for TOOFOO's impeachment. NB - this is before any of the longer-term effects on global food prices kick in caused by the lack of fertiliser and its related products transiting through Hormuz.
#5 Buyers of US Treasury Debt, which is what keeps this giant Ponzi alive, will realise that the coupon rates they receive as interest for holding this debt will be negative in real terms, when adjusted for the true rate of inflation.
#6 Many of these buyers of USTs are beginning to realise now that they are effectively investing in their own victimhood, especially now that the U$ dollar is so increasingly weaponised.
#7 Buyers of this debt will demand a higher return, meaning the 10-year benchmark rate will skyrocket, and so too will the costs for the US govt in servicing its approaching $40 trillion in public debt.
#8 The budget deficit will blow out even further, creating a feedback loop that will push interest rates even higher. The US appears to panic at anything above 4.4% for the 10-year-treasury, knowing that any territory around 5% and above will be terminal for the entire fiat Ponzi.
#9 The Gulf countries used to be massive investors in U$ debt - now they will have to pull money out. They will try to prolong the life cycle of this mathematically destined-to-fail Ponzi that they are embroiled in, by borrowing through international swap lines.
#10 Other Gulf countries could take the cue and also transition into the petroyuan system. This would accelerate the demise of the USD as the reserve currency of choice.
#11 The writing is already on the wall for all fiat currencies. Physical gold has now displaced the US dollar as the largest item, in terms of reserve assets, held around the world by central banks, etc.
All in all, this war with Iran is yet another massive own-goal for Trump #47, in terms of potential damage to the US economy, not to mention a raging bonfire of what remains of its global diplomatic capital.
Who would have thunk?... well, ummmm, surely, almost anyone with a few brain cells left to rub together.
Regards
Col
We get to the same conclusion, from entirely different starting-points.
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