Here's our summary of key economic events overnight that affect New Zealand with news commodity markets are betting all-in that a deal between the US and Iran will unlock the Strait of Hormuz soon. An Iranian State TV report has triggered the optimism. (And even though the US has denied it.)
More ships are transiting, but it is still only a fraction of 'normal'. However it is enough to drive the price of crude oil lower.
But despite all that, financial markets seem to remain unconvinced, or at least they have turned defensive due to what lies ahead of a resolution. How well any deal will stick between the two parties who have become quite transactional remains to be seen. Certainly the US is unlikely to be trusted to maintain the deal by both Iran, and even its own traditional allies. Iran will be Iran, agreeing but preparing for another attack/fight. The one thing the US/Israeli thing has done is solidify the Iranian regime's position at home. It no longer has internal dissent or street challenges, and it will thank Trump for that.
In the US, mortgage applications fell sharply last week, as US 30 year mortgage rates rose. Most of the fall is from the outsized retreat in refinance activity (-18%), although new purchase activity did dip as well. Those mortgage rates rose to their highest level since August 2025.
Meanwhile, the ADP tracking of private payrolls showed the good levels continued last week, even if there was a small dip posted.
And that is supported by factory survey data out from the Richmond Fed for the mid-Atlantic states area. New order levels rose notably. And firms expected growth in prices paid to moderate slightly over the next 12 months. But there was no improvement in the forward expectations, despite these improvements.
Meanwhile the Dallas Fed services sector survey remained quite negative, even if less so in May than in April. But their uncertainty metric is notably less.
There was a US Treasury 5yr Note auction overnight and that delivered a yield of 4.13% (4.18% high), up sharply from the 3.90% yield at the prior equivalent event a month ago.
In Australia, consumer price inflation came in lower than most analysts were expecting for April. It rose 4.2% from a year ago, lower than the March 4.6%, and lower than the expected 4.4%. From March, CPI prices rose +0.4%, also lower in the same way. A key reason is that fuel prices fell -7.0% from March to April, after rising 33% in the previous month. The fall this month includes the halving of the fuel excise on 1 April. Fuel prices are still +23.5% higher than in February and before the impact of the Middle East conflict. Apart from fuel, outsized rises were recorded for 'housing' (+6.3%) and 'clothing' (+5.9%). The main contributors to the annual housing rise were Electricity (+22.5%), New dwellings (+4.7%) and Rents (+3.5%).
And staying in Australia, Westpac has been hit with a AU$26 mln civil penalty for not dealing with clients who were struggling financially in a proper way. Remediation of all costs to those clients was AU$1.7 mln.
The UST 10yr yield is now just on 4.48%, down -1 bp from this time yesterday. The key 2-10 yield curve is now at +45 bps (+1 bp). Their 1-5 curve is now at +39 bps (+2 bps) and the 3 mth-10yr curve is at +81 bps (-3 bps). The China 10 year bond rate is down -1 bp at 1.74%. The Japanese 10 year bond yield is down -3 bps at 2.69%. The Australian 10 year bond yield starts today at 4.90%, down -3 bps. And the NZ Government 10 year bond rate is down -2 bps at 4.62%.
Wall Street is marking time today with the S&P500 up a minor 00.1%. The Nasdaq is up the same, both now off recent record highs. Overnight, European markets ended between Paris's +0.4% fall and Frankfurt's little-change. Yesterday, Tokyo also closed little-changed. Hong Kong fell a sharp -1.1% however and Shanghai was down even more, down -1.2%. Singapore ended down -0.8%. The ASX200 ended its Wednesday session up +0.7%. The NZX50 ended up +1.2% and the best of the markets we follow.
The price of gold will start today down another -US$49 at US$4450/oz. Silver is down -US$1.50 at just under US$74.50/oz.
Oil prices have fallen -US$4.50 to just on US$89.50/bbl in the US, while the international Brent price is now at US$95/bbl.
The Kiwi dollar is up +60 bps from yesterday at this time at 58.9 USc. Against the Aussie we are up +110 bps at 82.6 AUc. Against the euro we are up +50 bps at just under 50.7 euro cents. That all means our TWI-5 starts today at just under 62.4 which is up +60 bps from yesterday.
The bitcoin price starts today at US$74,765 and down -1.5% from this time yesterday. Volatility over the past 24 hours has been modest at just on +/- 1.0%.
There will be no video version of this article today. Join us later today for full coverage of the 2026 Budget release, an election budget of course.
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38 Comments
Bitcoin is looking like a pretty bad investment over the last 5 years or so. At what stage to people sell and cause a collapse? I guess you could ask a similar question about NZ property...
Questions are easy. Answers that are meaningful, not so much. Bit like the Canterbury earthquakes, all the experts knew all about them, after they happened.
Actually, that isn't a bad parallel.
There was an expert who pointed out the liquefaction problem - but he was ignored/sidelined. I remember seeing the clip.
Same with 'investments' (of any kind). Experts have pointed out that there are limits to growth, but they have been sidelined/ignored by those who need growth to be happening, for their forward bets (sorry; their investments - silly me) to be believable.
Now those forward bettors are vying for legitimacy, in an increasingly illegitimate theatre.
And ignorance, last time I checked, is no excuse.
Yes I saw that too and there was an article as well. There had been others too. Christchurch once had stand alone entities like the CDB, Christchurch Drainage Board. From my experience, they were very knowledgeable and obliging. I suggest most of that expertise and application got systemically diluted too near to ineffectuality when those functions got shoved into regional councils hence development on land with suspect sub strata that should never been approved.
You must be consuming fake news. I read in the comments here, so many times, that no matter your time frame, 6 months 12 months 1 yr, 2yr , 4yr bitcoin always got a great track record.
I've not seen that for a while. I presume the commenter took a bath on their investment in rat poison and could no longer afford the annual subscription.
Phoenix may have a more learned position though.
Yes not sure I'd pay $75K for a number in the hope that I could sell that number to someone else for more
Yes not sure I'd pay $75K for a number in the hope that I could sell that number to someone else for more
My lowest price scenario for this cycle is 10K - I might get it but don't know - low probability event, but not impossible. I can only get that if it's dumped like it was in Covid - March 2020.
Bitcoin is looking like a pretty bad investment over the last 5 years or so. At what stage to people sell and cause a collapse? I guess you could ask a similar question about NZ property...
Last greatest buying opportunity for the ol' rat poison would have been the Covid crash in 2020 if you're looking for the 10x opportunity.
Big difference between ratty and the Aotearoa Ponzi is the volatility. Emotion is tied to the volatility, therefore it's unsuitable for most people.
"The number of first-home buyers jumping into the property market without a 20% deposit has hit its highest level since records began, doubling over the past decade."
https://www.stuff.co.nz/home-property/360984702/nearly-half-all-first-h…
It's interesting that "the markets" seem inclined to believe Iranian tv more than USA tv.
Amazing people believe Trump is responsible for "no longer internal dissent or street challenges" rather than the clergy slaughtering 30,000 odd civilians in the streets/hospitals and banning the internet.
https://time.com/7357635/more-than-30000-killed-in-iran-say-senior-offi…
No doubt that's a factor, but it's always useful to have a foreign boogeyman to point to to help rally the population. Especially if he's making public statements threatening to erase your civilization and send you back to the stone age.
Obviously such utterances are hardly helpful but then neither was the speech by Iranian President Hashemite Rafsanjani in 2001 that the exact objective of Iranian acquiring a nuclear weapon was the annihilation of Israel and its people. Rather hard to not take such a well constructed threat seriously.
That may be considered to be somwhat like judging Germany of the 1960s on statements made by Goebells in the 1940s.
Germany in the 1960s was itself vastly different to all of the thirteen years of Nazi power and that change needed a World War to make it materialise. Considering the subject speech was subsequently endorsed by a succeeding President and that the regime in Iran has little changed, if at all, your comparison is quite a stretch.
https://www.un.org/unispal/document/auto-insert-189796/#:~:text=The%20p….
"Comparing this statement with the chapeau of the Israeli letter, where it says that “the Islamic world is arming itself with nuclear weapons in order to destroy Israel and undermine Western interests in the region”, and the rest of the letter clearly demonstrates the trickery, deceit and demagoguery of the Israeli regime. This would also reveal the poor propaganda by the Israeli regime to deflect international attention from its acts of State terrorism against the Palestinian people to frivolous and engineered issues."
The first casualty of war is truth
Well to paraphrase Mandy, they would say that wouldn’t they and that’s where your reference to the ill fated Joseph Goebbels is relevant. The entire world has been subjected to propaganda from every direction even before printing presses were invented. Call it wars of words or what you will but the exchanges as submitted I this case, wouldn’t have been necessary if the speech hadn’t been made in the first place which brings it back to the basic point that it was hardly helpful.
You choose to miss the point....your offered quote was a (deliberate) misinterpretation of part of a speech that had the opposite intent than portrayed by the misquote.
No the point, the statement, spoke for itself and rather than acknowledge the seriousness, you then attempted to deflect and distort it. As a further point, linking that overt threat to Israel, by comparison to the genocidal activities of Goebbels & Co , was a decidedly unfortunate example to choose, which assumedly was entirely unintentional.
I reckon being shot in the face and dragged out of a hospital would be more a much more motivating factor for the man in the street than death to America/Israel played on repeat for 47 years.
The 'Great Satan' rhetoric must hit harder when the Americans have just blown up a school in your town.
When it comes to "leadership" causing mass fatalities, Trump is going down in history with the best of them.
"Forecasting analyses projected that ongoing reductions in ODA funding could, under a severe defunding scenario, result in 22·6 million (95% uncertainty interval) additional deaths across all ages by 2030, including 5·4 million among children younger than 5 years.)
https://www.thelancet.com/journals/langlo/article/PIIS2214-109X(26)0000…
Some countries de-industrialize and plant their farms in pine trees, while some just change their calcs.
Under Beijing’s revised calculation for carbon intensity — the measure for the amount of CO₂ per unit of economic output — emissions in the world’s second-biggest economy rose 7 per cent from 2020 to 2025, said the Centre for Research on Energy and Clean Air, a European think-tank. The figure is half the rise indicated previously, a gap which amounts to around 700mn tonnes of carbon, or the same amount emitted annually by major manufacturing economies such as Germany and South Korea.
...In 2018, Beijing stopped publishing sectoral breakdowns of fixed asset investment by value and revised down historic totals for growth rates. Three years later, it discontinued a price series that had previously been used by economists when adjusting for inflation. Then in 2023, it discontinued data showing property developers’ purchases of land while also suspending youth unemployment data before releasing revised data which painted a less bleak picture.
https://www.ft.com/content/78d28a07-02ac-4a86-bcae-6eb70dd948b8?syn-25a6b1a6=1
Latest CO2 reading 432.27ppm
https://keelingcurve.ucsd.edu/
Fiddling the figures doesn't change the physics.
Planting more trees is never a bad idea in terms of long term survival. Using said planting as a ticket to continue large scale pollution is the main issue. Perhaps they need to pump the climate narrative then rug pull the masses and issue protections for the trees.
...The year 2023 was a unique year in the history of humanity, because it’s the first time our total fertility rate as a planet fell below replacement rate. That has never happened before in 200,000 years. That means the world population will peak in another 30 years or so if the trend continues.
The decline is accelerating faster than almost anybody predicted. As John Burn-Murdoch recently observed in the Financial Times, United Nations demographers predicted that there would be 350,000 births in South Korea in 2023; the real figure came in at 230,000.
...Thompson: If you go back to the 1960s and 1970s, it was common for public intellectuals to predict that the global population would rise and rise until the environment buckled and we suffered ecological disaster and widespread famine that wiped out billions of human souls. That has not happened. Global fertility has declined significantly. It’s falling faster than practically anybody predicted, certainly folks like Paul Ehrlich, author of the infamous book The Population Bomb. Why do you think these so-called experts were both so confident and so wrong?
Fernández-Villaverde: The wording of your question already tells you a lot about the answer, because you used the word public intellectuals. You didn’t use the word demographers.
https://www.theatlantic.com/ideas/2026/05/global-birthrate-decline/6872…
Much sooner than UN projections for 2100 population peak then? At last a good news story.
Is it really good news? The global population has trebled since WW2 & increased by a third since 2000.
The Western (+China thank to its 1 child dogma now acknowledged as a mistake) birth rates have declined rapidly since safe & reliable contraception & abortion became more widely available over the last 50+ years.
However above replacement birth rates have continued apace in countries riven by misogyny (incl lack of female education), religious dogma & authoritarian rulers. There's also Western/NZ govt social policies aimed at taxpayers rewarding fertility irrespective of personal responsibility for people's offspring. Another contributor to ever increasing numbers of refugees seeking Western social support.
you worried that "we" are being replaced by "them"?
Your straw man was not the point of my comment. Both my wives were immigrants & I've extended family overseas. I've lived & worked with "them" all my life - fully acknowledging "them" as "we".
I’d argue this shift is the result of engineered depopulation from the top down. The western world has shaped an economic landscape where dual incomes are mandatory for the basic family survival. By permanently locking in currency debasement via inflation and financialising the cost of shelter, the system has made human reproduction cost-prohibitive.
The reversal isn’t an accident of safe contraception alone, it’s a predictable outcome of a highly financialised, top down economic matrix that grows over time.
Furthermore, this population reversal is unfolding with immaculate timing. Just as labour is beginning to be replaced by algorithms, the demand for a massive human workforce is being phased out. It seems to be unfolding like a long term plan rather than a historical coincidence.
"1 child dogma now acknowledged as a mistake"
Who says it was a mistake? Christian fundimentalists? Dogma driven yeasty economic growthists? Authoritarians looking to project power through weight of numbers?
Those concerned with the health of the biosphere, and therefore human wellbeing, certainly wouldn't be too concerned about there being 400 000 000 less humans consuming and polluting?
Those concerned with the health of the biosphere, and therefore human wellbeing, certainly wouldn't be too concerned about there being 400 000 000 less humans consuming and polluting?
The elite would be concerned, hence the push for AI to help offset the need for said workers so they can keep the money train chugging along in their favour. When the 1%'ers have such heavy influence on the major systems, they cannot allow themselves to lose.
"Beijing officially and practically acknowledged its strict population restrictions as a mistake, formally ending the one-child rule in 2016 and expanding limits to three children in 2021."
https://share.google/aimode/vnfHI835dKeSWW7lF
"Too many men" is a grievous social wellbeing error
Pretty good socially if you're a single dude.
Pretty good socially if you're a single dude.
Or could have written.
"However above replacement birth rates have continued apace in countries riven by poor socioeconomic conditions, misogyny (incl lack of female education), religious dogma & authoritarian rulers. There's also Western/NZ govt poor social policies creating a lower socioeconomic group who then have fingers pointed for simply having offspring."
Easy to point fingers when your hogging all the resources. I have no doubt there's some who find the idea of recording tiny monetary compensation for having a baby tempting. But they are so few and far between I've never knowingly meet one despite the area I live. Literal urban myth.
I see advantages in a smaller population.
The mad increase hasn't worked out well has it.
It is an advantage in the long term, so long as at some point it stabilises, and most importantly, our major systems of tax and pensions are reformed in a way that doesn't rely on an ever increasing population. The former would likely happen, however the latter is only just becoming more of a mainstream discussion in realistic and logical ways.
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