Here's our summary of key economic events overnight that affect New Zealand, with news China's retail economy is about to grow larger than the US retail economy.
But first, the closely-watched Chicago PMI came in lower than expected and a lower than for October. But it is still expanding at a good level, just at slower rate.
And the November update to the Dallas Fed factory survey shows that Texas factory activity expanded in November for the sixth consecutive month, but at a markedly slower pace. There were sharp falls in output growth and new orders.
US pending home sales were expected to have risen slightly in October from September, but in fact they fell. This may mean the expansion of their housing market activity may be topping out.
Canadian building permits slumped in October, down -14% after a record jump the prior month.
China is reporting even better PMIs for November with the factory sector expanding well (52.1) and their services sector picking up the pace faster (56.4). China remains the global COVID engine of growth on which world trade seems to be based.
In fact, retail sales in China reached ¥40 tln (NZ$8.7 tln) in the past year as Beijing raised it focus on its domestic economy (part of its "dual circulation" strategy). Meanwhile, American retail sales totaled NZ$8.9 tln in the past year and the pandemic effects are weighing on recent results. Very soon the Chinese consumer will out-rank the American consumer on the global stage.
And as part of that shift, world food prices are rising sharply, especially grain prices. Chinese demand is taking the blame and food security is China's Achilles heel.
China's continued rise isn't smooth however. Yesterday their central bank had to inject a surprise ¥200 bln (NZ$43 bln) into their banking system to try and calm some of the instability being caused by their high-profile bond default issues by SOEs.
China's relationship with Australia is making news again too, and in an ugly way. Beijing has been caught distributing fake photos of Australian soldiers, all based on an event that only came to light from a free press, something Beijing opposes. The loss of face by Beijing in this incident will make it harder for them to backtrack however. The tensions between Canberra and Beijing have escalated.
In equity markets, Wall Street is ending the month with a -0.6% dip in Monday trade for the S&P500. But that will cap a huge monthly gain of US$2.9 tln or +10.5%. Overnight European markets tumbled about -1.5% although Frankfurt was down much less. Yesterday, Tokyo ended down -0.8%, Hong Kong was down a sharp -2.1% and Shanghai shed -0.5% on the day. The ASX closed down -1.3%, but the NZX50 Capital index was the outlier, rising +1.0% on the day to end the month with a +5.7% gain.
The latest global compilation of COVID-19 data is here. The global tally is 62,924,000 and a +476,000 rise overnight. It is still very grim in Russia, the UK, and Italy with great stress on their hospital systems. It does seem to be easing in Belgium, France and Spain. Global deaths reported now exceed 1,463,000 and up +7,000 in one days.
The largest number of reported cases globally are still in the US, which rose a more modest (for them) +132,000 overnight to 13,760,000. The US remains the global epicenter of the virus. The number of active cases is surging however at 5,377,000 and that level is up +64,000 in one day, so many more new cases more than recoveries. Hospitalisations have pushed up well above 100,000. Their death total now exceeds 273,000. The US now has a COVID death rate of 823/mln and is approaching the Argentine level.
In Australia, they are not getting any major resurgence. There have now been 27,904 COVID-19 cases reported, and that is just +11 more cases over the weekend. Now 61 of their cases are 'active' (-7). Reported deaths however have risen to 908.
The UST 10yr yield will start today little-changed at 0.84%. Their 2-10 rate curve is also little-changed at +70 bps, their 1-5 curve is stable at +26 bps, with their 3m-10 year curve is steeper +77 bps. The Australian Govt 10 year yield is also little-changed at 0.92%. The China Govt 10 year yield is down -4 bps at 3.30%, and the New Zealand Govt 10 year yield is also -4 bps lower at 0.85%.
The price of gold is -US$4 lower today at US$1784/oz.
Oil prices are a little lower today at US$45/bbl in the US, while the international price is now just under US$47.50/bbl.
And the Kiwi dollar has stayed high, but eased slightly to 70.1 USc this morning. Against the Australian dollar we are marginally firmer at 95.4 AUc. Against the euro we are also holding at 58.7 euro cents. That means our TWI-5 will start today at 72.6.
The bitcoin price has set a new record high today of $19,850 although it has settled back from there at US$19213 now which is +6.4% above where it was this time yesterday. 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 ».