Here's our summary of key economic events overnight that affect New Zealand, with news that the big global housing markets are on the ropes.
In the US the only significant data out overnight was its October existing home sales outcomes and that was weak, like all recent housing data from there. They are now openly calling this market in "a slump", with volumes down almost -6% from the prior month and almost -30% from a year ago. The downshift is building as this is the ninth straight month of falls and apart from the pandemic, these sales levels are at decade lows. But at the moment, sellers are holding off making deals, so prices are holding for the sharply fewer buyers who need to buy.
The relatively sudden pullback by a range of large tech companies, and the resulting layoffs, may be starting a similar track on their labour market. Twitter is the icon here, but certainly not the largest.
In Canada, the pressure on producer prices is not easing, with unexpectedly strong hikes in October from September, and from a year ago.
The CPI inflation rate in Japan climbed to 3.7% in October from 3.0% a month earlier. This was the highest reading since January 1991, and comes amid high prices for food and raw materials, as well as persistent yen weakness.
In China, their housing market is retreating as well, with no sign buyers are ready to return to their damaged market, no matter now much Beijing throws developers in rescue funding.
Not helping is a surge in the pandemic spread there. China’s new daily Covid cases jumped above 25,000 yesterday and a six-month high. Guangzhou had the highest tally, with more than 9,000 new cases among its 19 million residents. It is not a high load, but the impact is enormous given their official response to any infection. It is a pall that hangs over the entire global economy.
There is a general election in Malaysia today, with four candidates vying for the top job. It will be close. Sadly for them, all the options are a recycled set. The former Malaysian prime minister jailed for egregious corruption, still looms large as his son is a candidate. For most of them, this is their last roll of the dice.
The UST 10yr yield starts today at 3.82% and up +4 bps from yesterday and basically back to where it was a week ago. The UST 2-10 rate curve is little-changed at -68 bps. And their 1-5 curve is a but less inverted at -74 bps. But their 30 day-10yr curve has now slipped into an inversion, now at -4 bps and the first since . The Australian ten year bond is unchanged at 3.64%. The China Govt ten year bond is also little-changed at 2.84%. And the New Zealand Govt ten year will start today up +3 bps at 4.22%.
Wall Street is ending its Friday equity session down -0.2% with the S&P500 heading for a -1.0% weekly retreat. Overnight, European markets were generally stronger and by about +1.0% although London only rose half of that. Yesterday, Tokyo closed marginally lower to end the week down -1.3%. Hong Kong ended down -0.3% for a flat weekly result, while Shanghai ended down -0.6% also for a flat weekly result. The ASX200 ended its Friday session up +0.2% and a flat weekly result, while the NZX50 rose +0.8% enabling it to post a +0.6% weekly gain.
The price of gold will open today down -US$7 at US$1752/oz. A week ago it was at US$1766/oz.
And oil prices start today down another -US$3/bbl from this time yesterday at just on US$79/bbl in the US while the international Brent price is just over US$86.50/bbl. These are net -10% falls for the week.
The Kiwi dollar will open today at 61.5 USc and up +½c from yesterday, up a bit less for the week. Against the Australian dollar we are +¾c firmer at 92.2 AUc. That is our highest since April 2022. Against the euro we are also up +½c at 59.5 euro cents. That all means our TWI-5 starts today at 70.5 and up +60 bps to our highest since September.
The bitcoin price is now at US$16,557 and down -0.7% since this time yesterday and down -2.6% from a week ago. Volatility over the past 24 hours has been modest at +/- 1.3%.
The easiest place to stay up with event risk today is by following our Economic Calendar here ».
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