Here's our summary of key economic events overnight that affect New Zealand, with news some core data is showing signs of a turnaround in fortunes.
US jobless claims fell last week from the prior week, but the fall in actual numbers was minor. There are now 5.1 mln people on these programs, also a small reduction. But all the same, these are considered 'good' results mainly because analysts had expected rises.
All eyes are now on tomorrow's non farm payrolls report and a modest gain of +50,000 jobs is expected after the December decline of -140,000.
The story is similar for December factory orders, which also came in better than expected - not by much, and also a lesser gain than for November. But the 'above expectation' tone makes these results seem positive.
Vehicle sales in January slipped on a year-on-year basis and are still well behind the equivalent Chinese market. But they did bring a good gain from the prior month.
McKinsey & Company, the consultant to blue-chip companies and governments around the world, has agreed to pay NZ$800 mln to settle investigations into its role in helping “turbocharge” opioid sales, a rare instance of it being held publicly accountable for its work with clients.
In China, meat and vegetable prices have increased significantly since the start of the year, driven by both their cold winter and distribution issues around their sporadic coronavirus outbreaks over the last few weeks. Pork prices, which had been in retreat after a rapid recovery in pig numbers following the African swine fever outbreak, have returned to near their September highs.
EU retail sales grew more than expected in December, and this is after they fell sharply in November. It is an encouraging sign.
The Bank of England reviewed its policy settings overnight and left everything unchanged. It said its negative interest rate policy needs more time to work. It also downgraded the country's growth prospects.
Australian exports for both goods and services rose +3% in December from November, while their imports fell -2% on the same basis. Year on year for December however, these are -7% and -13% lower respectively. For the calendar year 2020 they are down -12% and -15% respectively. But the mix change did enable them to post much larger trade surpluses as a result of imports falling much more than exports.
Wall Street is posting another rise today with the S&P500 up +0.7% in early afternoon trade, and rising. Overnight European markets rose about +0.8% (although London fell again). Yesterday, the very large Tokyo market fell -1.1%, Hong Kong was down -0.7% and Shanghai retreated again, down -0.4%. The ASX200 fell -0.9% yesterday while the NZX50 Capital Index fell -0.8%.
The latest global compilation of COVID-19 data is here. The global tally is still rising, now at 104,573,000 and up +530,000 in one day. It is still very grim everywhere except in our region. Global deaths reported now exceed 2,274,000 and +16,000 since yesterday.
More countries (75) have started their vaccination programs. And although 105.5 mln doses have been given so far (+1.6 mln more overnight), nowhere has the tide turned on infections - except perhaps in Israel and the USA. However, there is clear evidence the vaccines are working to reduce or even eliminate deaths for those who have taken it.
The largest number of reported cases globally are still in the US, which rose +121,000 overnight for their tally to reach 27,162,000. The US remains the global epicentre of the virus. The number of active cases fell overnight and is now just on 9,790,000 and -38,000 less in one day, so more recoveries than new infections. And there are now more vaccinated people than active cases in the US, which is a milestone. Their death total is up to 462,000 however (+3000). The US now has a COVID death rate of 1392/mln, rising still but made to look 'good' by the disastrous UK level (1619) where deaths are still rising fast (110,000).
In Australia, their community control is impressive. Their all-time cases reported is now 28,838 and only +9 more cases overnight, one in the community, the rest from new arrivals and all in managed isolation. 52 of these cases are 'active' (-3). Reported deaths are also unchanged at 909.
The UST 10yr yield is up another +1 bp at just over 1.14%. Their 2-10 rate curve is steeper at 103 bps, their 1-5 curve is up at +39 bps, while their 3m-10 year curve is also steeper at +112 bps. The Australian Govt 10 year yield is up +5 bps at 1.23%. The China Govt 10 year yield is also up +3 bps at 3.26%, while the New Zealand Govt 10 year yield just keeps on rising and today is up +4 bps at 1.38% and a new yearly high.
The price of gold will start today down sharply, down -US$46 at US$1790/oz. Silver has followed.
Oil prices are unchanged at just on US$56/bbl in the US while the international price is now just over US$58.50/bbl. But they have been quite volatile in between.
And the Kiwi dollar will open today giving back much of yesterday's rise. It is now at 71.6 USc. Against the Australian dollar we are also softer at 94.2 AUc. Against the euro we are just under at 59.8 euro cents. That means our TWI-5 is down marginally to 73.6.
The bitcoin price has changed little overnight and slipped only very slightly to US$36,987. Volatility has been a relatively low +/- 3.5%. 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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