Here's our summary of key events overnight that affect New Zealand, with news there will be 3.2 bln more people to feed by the end of the century.
But first, markets are in a bit of a holding pattern today, waiting on policy direction from upcoming US Fed and ECB meetings. But the data continues to roll in.
In the New York region, factories there have turned very gloomy. Business activity took a sharp turn downward, according to New York Fed's June 2019 Empire State Manufacturing Survey. Their general business conditions index plummeted twenty-six points, its largest monthly decline on record, to -8.6. New orders posted a "significant decline".
The national NAHB housing market index also fell in June, although not as sharply. Tariff concerns are being reported by home builders now.
And staying in the US, their securities regulator has fined KPMG US$50 mln and charged them with altering past audit work after receiving stolen information. The SEC’s order also finds that numerous KPMG audit professionals cheated on internal training exams by improperly sharing answers and manipulating test results. KPMG moved to get the case behind it by agreeing to the big fine.
Equity markets are in that holding mode. The S&P500 is up a modest +0.2% which follows similar small gains in Europe. Yesterday the NZX50 fell -0.6% and the ASX200 fell -0.4% (and we should note that ANZ shares actually rose +0.2% on the day). Tokyo was little changed, Hong Kong was up +0.4% while Shanghai was down -0.8%.
China has lost an important case relating to its export of subsidised products. At the World Trade Organisation, China has halted the dispute over its claim to be a market economy. By raising a white flag before a ruling became official, that means Beijing must accept continued EU and US “anti-dumping” levies on cheap Chinese goods.
And back home in China, worried officials are grappling with the contagion of a failed bank. The bank failed almost four weeks ago, but liquidity pressures on many other smaller banks have been spreading since and it is now becoming a national issue.
The United Nations has downgraded its population forecasts overnight. They now say the current population of 7.7 bln will peak at under 11 bln at the end of this century, and will rise to 9.7 bln by 2050. All the while, they say, the demographics will grow older fast and an increasing number of countries will face population declines - and China is one of them. The bottom line though is that in the next hundred years the world's population is still expected to rise by +40%.
The UST 10yr yield is at 2.09% and in a holding pattern until we hear from the US Fed. Their 2-10 curve is slightly narrower at +22 bps while their negative 1-5 curve is slightly wider at -20 bps. The Aussie Govt 10yr is up +2 bps at 1.39%. The China Govt 10yr is down -1 bp to 3.27%, while the NZ Govt 10 yr is unchanged at 1.67%.
Gold is down -US$3 today at US$1,338/oz.
US oil prices are marginally lower overnight. They are now just on US$52/bbl. The Brent benchmark is now at US$61.
The Kiwi dollar is holding at 65 USc. On the cross rates we have recovered a bit to be at 94.8 AUc. Against the euro we are little-changed at 57.9 euro cents. That all puts the TWI-5 up to just on 70.
Bitcoin has risen again overnight and is currently +2.3% higher at US$9,263. That pushes up the price in NZ dollars to over $14,000 for the first time since March 2018. The bitcoin rate is charted in the exchange rate set below.
The easiest place to stay up with event risk today is by following our Economic Calendar here ».