Here's our summary of key economic events overnight that affect New Zealand, with news financial markets are shunning exposure to tech stocks today on the expectation that their free-ride will be coming to an end over the next few years as a result of the US election shifts. Some specific stocks like SpaceX (-10%) are down sharply. The AI backlash is threatening datacenter investment plans.
Tomorrow we get the October US non-farm payrolls report and a +65,000 gain is anticipated by financial markets. Today, October monitoring of US job cuts had them staying at a low 44,000 level and that equals a three year low.
US jobless claims were low again last week at 176,700 and slightly below what seasonal factors would have accounted for. There are now under 1.5 mln people on these benefits and near their lowest since 2023. Much tighter qualification requirements are a significant reason for this falling level.
The Richmond Fed boss said today that policy interest rates are going to have to rise, but he claimed the pace would be gradual. The Cleveland Fed boss said something similar today too.
US light-vehicle sales fell to an annual rate of 15.54 million units in October, down -0.9% from a year ago . That's a fall of -140,000. Affordability remains a major challenge for the industry, with pressures showing no signs of easing. They have tariffs to blame for that. The average monthly payment on a new-vehicle financing contract reached US$823 in October, up +2.6% from a year earlier. Conventional hybrids continue to attract strong demand, as they have over the past year
But US gloom seems to be lifting. US holiday retail sales are set to rise +4.5% year-on-year in the last two months of 2026, marking the strongest growth since 2021, according to research by Visa Economics.
Across the Pacific, Taiwan’s CPI inflation rate eased to 2.3% in October, down from a 31-month high of 2.7% in September. It has been above their central bank’s 2% target for six consecutive months now.
Malaysia held its central bank policy rate unchanged at 2.75% overnight.
Meanwhile in Europe, the Swedish central bank raised its policy rate by +25 bps to 2.0% citing inflation risks. However the Norwegian central bank met too, but deferred any changes to their 4.5% rate at this time after their September hike. They are nervous about inflation's track as well.
As expected, the Bank of England raised its policy rate by +25 bps to 4.0%, its first increase since mid 2023. Unusually for them, the vote was almost unanimous - the one dissenter wanted a +50 bps hike. And that is because their current CPI inflation rate of 3.5% is expected to rise relentlessly to 5% over the next year or so.
Australia delivered a strong export performance in September with them up +2.3% from August and up +10.4% from a year ago. Meanwhile their imports fell -3.3% from August but were up +11.7% from a year ago. That means they recorded a +AU$2.85 bln trade surplus in the month, only marginally smaller than the AU$3.05 bln in the same month in 2025. Driving their exports were strong sales of gold (+18.2%) and minerals (+11.0%). Not driving their gains were exports of "rural goods".
Global container freight rates were little-changed last week to be +124% higher than year-ago levels. Similarly, bulk cargo rates were little-changed too, and they are now +36% higher than year-ago levels. Somewhat confirming that, the New York Fed's global supply chain pressure index remained at little-changed levels in October. But is still quite elevated.
And it is probably worth noting a couple of high-profile failures overnight LIV Golf can't be saved and its run has ended. And Australian icon department store retailer David Jones is almost certainly also going into extinction.
The UST 10yr yield is down -8 bps from yesterday at 4.83%. The 30 year yield is at 5.25%, down -4 bps from yesterday. The key 2-10 yield curve is now at +32 bps (up +1 bp). Their 1-5 curve is at +28 bps (-3 bps) and the 3 mth-10yr curve is at +92 bps (-5 bps). The China 10 year bond rate is down -2 bps at just over 1.59%. The Japanese 10 year bond yield is down -6 bps at 2.75%. The Australian 10 year bond yield starts today at 5.00%, down -3 bps. The NZ Government 10 year bond rate is now at 4.77% and down -7 bps.
Wall Street is falling today with the S&P500 down -3.7% and the Nasdaq down -4.9%. Overnight, European markets were mixed with Paris up +0.3% and London down -0.4%. Tokyo closed yesterday with a -1.8% fall. Hong Kong rose +3.7% but Shanghai was only up +0.1%. Singapore ended up +0.5%. The ASX200 rose +2.6% in its Thursday trade. The NZX50 rose +2.2%.
The price of gold is up +US$56 at US$4120/oz. Silver is now just over US$52.50/oz and up +50 USc from yesterday.
Oil prices have risen a minor +50 USc today, to just on US$90/bbl in the US, while the international Brent price is up +US$1 at just on US$96.50/bbl. Hormuz transits have stayed lower today with just three ships exiting over the past 24 hours, no tanker escorted (1 dark with transponders off) and two entering for new loads, no tankers (0 dark). The Red Sea activity features much lower inbound traffic, higher outbound traffic at the Yemen chokepoint.
The Kiwi dollar is down -10 bps from yesterday at just on 56.1 USc. Against the Aussie we are up +½c at 80.7 AUc. Against the euro we are down -10 bps at 50 euro cents. That all means our TWI-5 starts today at just on 59.9 and little-changed from yesterday.
The bitcoin price starts today at US$76,394 and down -5.2% from this time yesterday. Volatility over the past 24 hours has been high at +/-3.4%.
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