China demographics weaken again, their gold reserves rise; US payrolls rise on dubious data; US credit card debt jumps; Canada jobs retreat; EU retail resilient; UST 10yr at 4.85%; gold rises and oil stabilises; NZ$1 = 55.4 USc; TWI-5 = 59.4

Here's our summary of key economic events over the weekend that affect New Zealand, with news data from the world's two largest economies has heads being scratched.

But first in the week ahead locally we will get a look at October retail sales with electronic card transaction data on Thursday and it isn't expected to very good. And the RBNZ's inflation expectations survey will be out for Q4 this week too.

In Australia it will be a light data week, apart from the important Westpac consumer sentiment update and the NAB business sentiment update, both for November.

In the US, there will be CPI and PPI updates for October released this week.

In China we will also be watching their October CPI and PPI, plus their trade data where their surplus is expected to stay very high - remaining a growing irritant to its trading partners. Their domestic economy signals are not expected to shine and the key data point for this will be for October new yuan loans.

Over the weekend we got new indications that their demographic problem isn't improving, with marriages (and therefor births) still falling sharply.

And China has passed 'anti-corruption' laws that tries to expand its jurisdiction to overseas countries. And at the same time their law requires foreign companies to provide information involving graft cases, while barring overseas law enforcement from conducting anti-corruption investigations in China. Chinese exceptionalism is on the rise.

China's FX reserves were little-changed in October, moving only because of currency shifts and asset variations. But China did add almost +1.1% to its gold holdings for the 24th consecutive month, with reserves rising +25.8 tonnes to 2435.4 tonnes at the end of October.

And we should note that there is a US-China summit meeting between their two presidents in about ten days time in Shenzhen (population 18.5 mln), their tech powerhouse center just across the border from Hong Kong (population 7.5 mln). There are more tech billionaires in Shenzhen (130+) than in Silicon Valley (80+).

In the US, their October non-farm payrolls surprised with a headline seasonally adjusted rise of +165,000 jobs and very much higher than what was expected or indicated in parallel non-official monitoring. On an actual basis, they say payrolls rose a bit more than +1 mln in October.

The wider population survey results were very positive too, recording employment up +744,000. The curious thing is that no-one else noticed these surges happening. 

Meanwhile the rise in average earnings cooled, average hours worked marginally fell, and the participation rate was unchanged. None of these metrics back up the strong employment rises claimed.

Best to wait a month or two to see if they are sustained. On their own they give the Fed room to fight inflation harder as their labour market is apparently rising fast. 

And also better than expected was the November release of the widely watched University of Michigan sentiment survey, which was less pessimistic than in October. It shifted back to its August levels and off its all-time lows to be little-changed from year-ago levels. Inflation expectations fell back too, now at 4.3% and a better improvement than expected. This survey pre-dated the election but perhaps there was a sense of the impending outcome; the wealthy got notably grumpier in these results; the less well off saw upsides in the future.

US consumer debt rose +US$28 bln in September, rising a strong +6.4% from a year ago. Leading the debt binge was a very sharp +14.5% rise in revolving debt which includes credit cards. This isn't a great sign given it indicates fast-rising debt stress in the most expensive personal debt category.

Canada also released October labour market data over the weekend and while the total number of jobs dipped only very slightly (-4,700), it would have been worse without the +13,400 gain in part-time jobs. Their jobless rate rose to 6.7% and giving up the gains since April. The expected December rate hike there is now probably in doubt.

The Canadian government released its 2026 Budget with a clear focus on building resilience and independence from the US. It is a transition that will cost them large public sector investment and longer deficits. They have had to slow their defense budget growth to accommodate what they plan. But in the age where "everything is national security" they probably don't see it that way.

EU retail sales slipped in September from August to be only +0.9% higher than year ago levels, by volume. But at least that is still a real rise. And it might be better than it looks because all the retail volume fall is due to buying less fuels. Eastern and Nordic Europe saw strong retail gains. It was falls in Germany, Spain and Italy that capped the gains. Interestingly, retail sales volumes were strong in France in September.

Global food prices edged lower in October, although dairy prices held most of their levels. Meat prices dipped, mostly on falling Chinese pork prices.

And while we are thinking globally, the OECD is reporting that inflation in their 38 member countries at 4.55%, up from 4.27% in August.

The UST 10yr yield is up +1 bp from Saturday, now at 4.86% but that is down -7 bps from this time last week. The 30 year yield is at 5.26%, up +2 bps from Saturday. The key 2-10 yield curve is now at +34 bps (unchanged). Their 1-5 curve is at +32 bps (+3 bps) and the 3 mth-10yr curve is at +92 bps (+3 bps). The China 10 year bond rate is up +3 bps at just on 1.60%, down -3 bps for the week. The Japanese 10 year bond yield is down -3 bps at 2.64%, down -14 bps for the week. The Australian 10 year bond yield starts today at 5.00%, unchanged from Friday, down -13 bps for the week. The NZ Government 10 year bond rate is now at 4.79%, also unchanged from Friday but down -5 bps for the week.

The price of gold is up +US$11 at US$4170/oz and up +4.8% for the week. Silver is now just under US$52/oz and little-changed from Saturday. A week ago these prices were US$3876/oz and US$52/oz respectively.

Oil prices have risen +US$1 today, to just under US$91/bbl in the US, while the international Brent price is also up +US$1 at just under US$98.50/bbl. A week ago these prices were US$104/bbl and US$113.50/bbl respectively so they are down -14% in that time. Hormuz transits have picked up slightly today with eight ships exiting over the past 24 hours, two tanker escorted (1 dark with transponders off) and eight entering for new loads, no tankers (2 dark). The Red Sea activity features much lower traffic at the Yemen chokepoint.

The Kiwi dollar is little-changed from Saturday at just on 55.4 USc which makes the weekly drop -90 bps and which we make as its lowest since 2009. Against the Aussie we are down -10c at 80.7 AUc. Against the euro we are holding just over at 49.7 euro cents. That all means our TWI-5 starts today at just under 59.4 and unchanged from Saturday to its lowest in 17 years as well.

The bitcoin price starts today at US$75,930, up +0.4% from this time Saturday, but down -1.7% for the week. Volatility over the past 24 hours has been low at +/-0.7%.

The easiest place to stay up with event risk is by following our Economic Calendar here ».