US trade balance stay near record deficit; China Singles Day frenzy starts; more countries join carbon neutral target; equity markets dive; UST 10y at 0.76%; oil and gold drop hard; NZ$1 = 66.5 USc; TWI-5 = 69.9

Here's our summary of key economic events overnight that affect New Zealand, with news of more heavy falls in share markets of countries suffering from renewed virus hits.

But first, the US merchandise trade balance for September was -US$85 bln, matching August and just marginally less than the record set in July. Exports were down -10% year-on-year while imports were unchanged, so it is a major deterioration from a year ago

Aircraft maker Boeing says it will shed another -7000 jobs over the next year, on top of the already very heavy -23,000 retrenchments already made. It is now reporting losses and large negative cash flows.

In China, the online frenzy that is "Singles Day" (Nov 11, or "double 11") has started already with hugely popular and aggressive pre-sales. It is a retailing event that will show up in their Q4 GDP results. It is a sales frenzy that will be joined by 100s of millions of people, clog their distribution and logistics networks, and involve vast spending surges. Black Friday is but a shadow of Double-11. It is covered here because it is an economic event of global significance.

And China is also getting ready to roll out a digital yuan in digital wallets - but even in its test stage, counterfeits are having to be dealt with.

In South Korea, consumer confidence jumped the most since the GFC in a very positive sign for their economy as it makes its pandemic recovery.

South Korea has now joined Japan in committing to be carbon-neutral in 30 years. They are ahead of China which says it will achieve that in 40 years. New Zealand also has the 2050 target. (Australia has ignored the target Federally, but every State in Australia has adopted it.)

In Australia, their CPI inflation was up +0.7% in the year to September. This quarter it rose +1.6% not quite cancelling out Q2's -1.9% drop. Interestingly, retailers took advantage of strong consumer demand increasing prices for "furnishings, household equipment and services" by a massive +12% in the quarter and recovering their competitive cuts in prior quarters - the "Harvey Norman surge" building back margins by taking advantage of consumer stress. The ending of free childcare over the pandemic onset also raised the CPI rate.

Wall Street is back with major losses today with the S&P500 down -2.9% in early afternoon trade. Overnight even larger falls came out of European markets with Frankfurt down a heavy -4.2%, others less so but still steep declines. Yesterday Shanghai ended up +0.5% while both Hong Kong and Tokyo shed -0.3% each. Both the ASX200 and the NZX50 Capital Index added a modest +0.1% at their respective closes.

The latest global compilation of COVID-19 data is here. The global tally is 44,159,000 and up +506,000 since yesterday. In Russia, France, Spain, the UK and southern Italy authorities seem to have lost control and it is hard to know how they will regain it without new sweeping lockdowns. Global deaths reported now exceed 1,170,000 (+8,000). A sharp rise in deaths is now expected now this third wave has taken hold.

The largest number of reported cases globally are still in the US, which rose +78,000 since yesterday to 9,057,000. The number of active cases is higher at 2,935,000 so many more new cases more than recoveries. And a new trend is the sharp rise in hospitalisations. Their death total now exceeds 232,000 and still rising at nearly +1000 per day. The US is now in that exclusive club of ten nations (some very small) with a death/million rate exceeding 700.

In Australia, they are not getting any resurgence. There have now been 27,554 COVID-19 cases reported, and that is +27 more cases than we reported yesterday with most in NSW. Reported deaths are up +2 at 907.

The UST 10yr yield is down -2 bps today at just on 0.76%. Their 2-10 rate curve is a little flatter again overnight at +61 bps, their 1-5 curve is also flatter at +20 bps, along with their 3m-10 year curve, now flatter at +69 bps. The Australian Govt 10 year yield will start today down -1 bp at 0.78%. The China Govt 10 year yield is unchanged at 3.19%. But the New Zealand Govt 10 year yield is down another chunky -4 bps to just on 0.51%.

The price of gold is down sharply today, down -US$29 today to US$1880/oz.

Oil prices have also fallen sharply, down -US$2.50 to now at just on US$37/bbl in the US, while the international price is down a bit less to just under US$39/bbl. These falls are on the back of very large rises in crude oil inventories in the US as local production rises more than expected. And it is China that is buying that very cheap American crude.

And the Kiwi dollar is softer by more than -½c at 66.5 USc. Against the Australian dollar we have remained firm at 94.3 AUc. Against the euro we also holding at 56.6 euro cents. But that means our TWI-5 is down to 69.9.

The bitcoin price starts today down -3.4% at US$13,140 but holding on to about half of yesterday's rise. 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 ».