Here's our summary of key economic events overnight that affect New Zealand, with news surging exports and a range of stimulus measures (subsidies) are bolstering Chinese economic activity. It is a track likely to run into stiff resistance from many of the countries targeted by these subsidised exports - so the Chinese economic stability may not last much longer.
But first in the US, the Wells Fargo/NAHB house builder sentiment is being squeezed by higher costs and buyer affordability restraint. Their index fell for a second consecutive month to its lowest since June 2012. Sales expectations in the next six months dropped to the lowest since November 2022.
The US has trimmed some tariffs on Canadian lumber but that is not expected to have much impact. Meanwhile in Canada they reported CPI inflation running at 3.1% in September, only marginally higher than August and less than the 3.2% expected. It has been holding at this level since May and kept up due to fuel prices of course. (It is still notably lower than their southern neighbour's 3.7% September rate, but then, they don't have the tariff pressure the US has imposed on itself.)
And staying in Canada, a key survey of consumer inflation expectations has them at 4.0% for the year ahead which is just a whisker higher than what those surveyed thought inflation was running at presently.
Meanwhile a Canadian survey of business sentiment shows it improved in Q3-2026 after deteriorating in the previous quarter. But to be fair most of these survey responses came before Trump's latest outburst.
In China, 16 of their 70 largest urban areas had a small rise in new house prices in September from August, four has no change, while the rest reported small declines. Overall, these new house prices were down -2.8% from a year ago, a slightly smaller decline than in August. For existing homes, the improvement was less and the year-ago change approached -6%. So not noticeable improvement in their housing markets.
China reported that its Q3-2026 economic activity grew +4.5% from the same quarter a year ago. That was better than the 4.3% in Q2-2026. They have a GDP growth target of "about 4.5%".
China said its industrial production was up +5.5% in September, better than the 5.2% claimed for August. But they also said their electricity production was -1.2% lower from a year ago, which doesn't really support the claim of higher production - unless they have had the surge of productivity that this implies.
Chinese retail sales were up +1.0% in September from a year ago according to the same official data release, more than August's +0.4% and better than expected.
And in Shanghai, they now have the world's highest office vacancy rate as foreign companies back off from investing in China. According to CBRE, a quarter of all office space there is vacant.
Around the world, multiple supply shocks are starting to affect food prices. It is not only grain from Ukraine and Russia, but in Indonesia, rice prices have already jumped to record highs amid forecasts of delayed rains, while the cost of bread in Egypt has risen by a quarter, and sugar prices in India hit an all-time high as the weakest monsoon in over a decade curbed production. These pressures have all the ingredients for social unrest.
In Australia, we should note the attempted assassination of an independent MP, an ugly trend in right-wing partisan politics.
The UST 10yr yield is up +4 bps from yesterday to 5.14%. The 30 year yield is at 5.48%, up +4 bps. The key 2-10 yield curve is now at +37 bps (+1 bp). Their 1-5 curve is now at +46 bps (no change) and the 3 mth-10yr curve is at +114 bps (+6 bps). French bond yeilds have risen but to be fair they are not yet at US or Australian levels yet. The China 10 year bond rate is holding at 1.65%. The Japanese 10 year bond yield is now at 2.95%, up +1 bp from yesterday. The Australian 10 year bond yield starts today at 5.25%, up +1 bp from yesterday. The NZ Government 10 year bond rate is now at 5.04%, also up +1 bp.
Wall Street has started its week up +0.6% on the S&P500 while the Nasdaq is up +1.4%, both on positive earnings reports. Overnight European markets were all lower however, all down -1.1%. Yesterday Tokyo ended its Monday session down -0.6%. Hong Kong ended up +0.5% and Shanghai was up +0.4%. Singapore ended by dipping -0.1%. The ASX200 was up +0.4% in its Monday session. The NZX50 ended down -0.7%.
The price of gold is at US$4139/oz and down -US$27 from yesterday. Silver is unchanged at just on US$57/oz.
Oil prices have risen +US$1.50 from yesterday to just over US$103/bbl in the US, while the international Brent price is unchanged at US$110/bbl. Hormuz transits have stayed low today with just seven ships exiting over the past 24 hours, 3 tankers escorted (1 dark with transponders off) and 5 entering for new loads, one tanker (3 dark). The Red Sea activity is lower with less than 20 transits both ways at the Yemen chokepoint.
The Kiwi dollar is +10 bps firmer from yesterday, at just on 56.6 USc. Against the Aussie we are down -30 bps at 81.1 AUc. Against the euro we are up +20 bps at 50.5 euro cents. That all means our TWI-5 starts today at just over 60.4 and little-changed from yesterday.
The bitcoin price starts today at US$81,908 and up +1.1% from yesterday at this time. Volatility over the past 24 hours has been modest at +/-1.4%.
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