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Here's our summary of key events overnight that affect New Zealand, with news of markets unimpressed by the latest data.
But first today, the latest dairy auction has delivered something of a positive surprise. Prices are up +2.7% in US dollar terms, slightly less in New Zealand dollar terms. There have been good gains for Wholemilk Powers and Skimmilk Powders. The derivative markets weren't expecting this. And these gains have come despite a strengthening of the Kiwi dollar. Since the recent high point in May, dairy prices had dropped back by almost -9%. But today's rise has pegged that fall back to just -6%. In of itself this improvement won't change any farmgate milk payout price, but it is the first rise in the last five auctions and will be a welcome respite. To mean anything however, it needs to be sustained - for another five auctions or so.
In the US, the June retail sales results came in officially up +3.4% year-on-year and at a similar pace as the previous month. But 'seasonal adjustment' seemed to help it; on an actual basis the June-19-on-June-18 increase was only +1.8% and barely above their inflation rate. This is not a result that has impressed analysts.
Meanwhile, American industrial production rose only +1.3% in June from the same quarter a year ago. Manufacturing was only up +0.4% on the same basis. Both were outcomes lower than expected.
At the World Trade Organisation, the US has lost a case involving trade restrictions on products sold by Chinese State Owned Enterprises.
In China, the collapse of a large private bond trader is causing waves in their financial system.
In Germany, sentiment fell further in their latest, influential ZEW survey.
In Britain, all their leading accounting firms have failed to hit quality targets set by their regulator for auditing company books - and for the second year in a row, with Grant Thornton and PwC singled out to join KPMG under tougher supervision.
In Australia, their Government has released a report into banking regulator APRA - and that shows it has similar culture and conduct issues as the banks it regulates. Few in banking who deal with APRA will be surprised by this finding. But the main impact will be on how it now engages with the Aussie superannuation industry, with whom it had a cosy, hands off approach and that is now likely to change.
The UST 10yr yield will open today at 2.12% and +3 bps higher than this time yesterday. Their 2-10 curve is holding on to its steeper shape, unchanged at +26 bps, and their negative 1-5 curve is unchanged at -11 bps. The Aussie Govt 10yr is down -2 bps at 1.42%. The China Govt 10yr is also unchanged again at 3.19%, while the NZ Govt 10 yr is now at 1.63%, a -5 bps retreat.
Gold is down -US$6 overnight to US$1,407/oz.
US oil prices are falling sharply today as the weak US retail sales suggests demand may have peaked. They are now down more than -US$2 to US$57.50/bbl. But the Brent benchmark is down a similar amount at US$64.50.
The Kiwi dollar is still strong but has slipped back just a bit to just on 67 USc. On the cross rates we are also holding high at 95.5 AUc. Against the euro we are up at 59.8 euro cents. That leaves the TWI-5 up at just on 72 and unchanged from yesterday.
Bitcoin has fallen sharply from this time yesterday, now at US$9,680, and -US$800 net drop or -7.7% in 24 hours. The 24 hr volatility has been +/- 8.3%. 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 ».
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