Here's our summary of key economic events overnight that affect New Zealand, with news Chinese data is still standing out in a world of declines.
But first up today is the overnight dairy auction and that brought the good news of higher prices, ending a string of four declines. Overall prices were up +3.6% in US dollar terms and up +4.3% in New Zealand dollar terms. However this only brings prices back to the average level since March in US dollar terms, and are only a very minor recovery in New Zealand dollar terms. Of note were the +7.2% rise in cheese prices and the +8.4% rise in SMP. WMP however only rose +3.2% this time.
In the US, retail sales are on the downward slope again, falling -1.2% year-on-year after clawing back to almost level pegging earlier in August and the first part of September. But the toll of rising joblessness and the end of make-up spending is bringing the expected impact.
American industrial production is going backwards too, down -7.7% on a year-on-year basis to August and that was a steeper decline than the -7.4% in July.
But not every region is easing; the latest Fed factory survey for New York State is more upbeat.
Canadian factory sales also declined -6.9% on a year-on-year basis, despite recovering from the recent trough.
Overnight the WTO ruled that the US tariffs on Chinese goods break their commitments on trade. However, it is a rebuke that will have no practical consequence for Washington.
China has reported that its industrial production rose +5.6% in August compared with the same month in 2019. Electricity production grew +6.8% which was impressive and verifies the factory output claims. That is in stark contrast to most other countries.
China also says its retail sales grew, and that was better than the no-change expected.
And as a consequence, the Chinese yuan has hit a 16 month high.
The US National Academy of Sciences has published findings of clear satellite evidence that two huge ice sheets are starting to shear off, and move into the oceans. They include so much material that they could account for as much as a +3m rise in ocean levels, the study warned. (Research link currently behind paywall.)
In Australia, the RBA minutes were published yesterday and they noted that "the downturn had not been as severe as earlier expected and a recovery was under way in most of Australia".
Separately, the Australian Competition Tribunal found that their competition regulator, the ACCC, failed to show that using BNPL products to buy solar panels would result in any consumer harm. It is being hailed as a big win for the BNPL sector.
And Westpac economists said global demand for commodities can be split into two camps - that which is predominately linked to Chinese industrialisation and hence largely determined by Chinese demand, and that which is more linked to the global industrial cycle and global demand more broadly. Iron ore is a standout for the former group, while coal is the defining commodity for the later.
And if you read some media in Australia (mainly the Murdoch press) you would think that Daniel Andrews, the premier of Victoria, was the devil incarnate. But actually, Victorians support his tough and long lockdowns, and by an overwhelming margin (70:24:6).
On Wall Street today, the S&P500 is up +0.7% in afternoon trade. Overnight, European markets closed with minor gains of about +0.3%. Yesterday, Shanghai ended the day up +0.9%, Hong Kong was also up +0.5%, and Tokyo rose +0.4% on the day. The ASX200 ended flat and the NZX50 Capital Index fell -0.2%.
The latest global compilation of COVID-19 data is here. The global tally is 29,386,000 and up +272,000 in one day. Global deaths now exceed 931,000 (+5,000).
Just under a quarter of all reported cases globally are in the US, which is up +42,000 to 6,765,000. Their death total is now 199,600 and still rising at about +1000 a day (and now 602/mln).
In Australia, there have now been 26,738 COVID-19 cases reported, and that is only +46 more cases from yesterday and only from Victoria and NSW. Deaths however are unchanged at 816. Their recovery rate is up over 88% now.
The UST 10yr yield is marginally firmer at just on 0.68%. Their 2-10 rate curve is unchanged at +54 bps, their 1-5 curve is at +14 bps, while their 3m-10 year curve is now just over +59 bps. The Australian Govt 10 year yield is down -3 bps at 0.92%. The China Govt 10 year yield is also down -3 bps at 3.14%. However, the New Zealand Govt 10 year yield is still unchanged at 0.61%.
The price of gold will start today at US$1954/oz which is unchanged.
Oil prices will start today at just under US$38.50/bbl in the US while the international price is now just over US$40.50/bbl. These levels are +US$1 higher than yesterday.
The Kiwi dollar will start today at 67.2 USc and marginally higher from this time yesterday. Against the Australian dollar we are unchanged at 92 AUc. Against the euro we are also a little firmer at 56.7 euro cents. That means our TWI-5 is now at 70.1.
The bitcoin price is also a little higher today, now at US$10,793. 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 ».