Here's our summary of key economic events overnight with news global food prices rocketed high again in March.
But first, there was a somewhat surprising rise in US jobless claims last week, surprising because it cuts across the recent narrative that things are improving fast in their labour market. There were +741,000 new claims last week, well above the expected level of +680,000. Now there are just on 4 mln people on these benefits.
US housing market activity is probably slowing too, with mortgage applications down -5% last week from the prior week, and now down -20% on a year-on-year basis. Mortgage interest rates had an interruption to their 2021 trend higher, with the benchmark 30yr fixed rate slipping slightly to 3.13% plus points.
Internationally, US Treasury Secretary Janet Yellen's push for a global minimum tax rate for multinational companies got a boost from her boss who said these companies should pay taxes where they operate. But it is getting some surprising pushback from the World Bank, the boss of which claimed the suggested 21% minimum was "too high". And China, and its tax haven Hong Kong, is not on board with these reforms yet.
In Hong Kong, one of the world's most unaffordable cities for housing, more than 4% of its homes were unoccupied at the end of 2020, according to data just released. That is a +17% rise over the year and the highest level since records began for this metric in 2015.
In the EU, producer prices are on the move higher, a harbinger of future inflation. Already higher are EU house prices - and rents ... although to be fair, these rises are tame from the New Zealand perspectives.
Global food prices rose another +2.1% in the month of March alone, from February. Dairy prices jumped +3.9% on that basis and meat prices were up +2.3%. Overall, prices are up a worrying +25% in a year, led by the price of vegetable oils that are rocketing higher and up almost +90% in a year. The cost of food is now approaching the all-time peak reached in 2011 in nominal terms, although in real terms the peak was in 1974. In the 1970s that was a time of extreme inflation generally, and non-existent growth, known as stagflation.
On Wall Street, the S&P500 is up a modest +0.3% in early afternoon trade. European markets were up an average of +0.5% overnight. Yesterday, the Shanghai market ended up +0.1%, Hong Kong was up +1.2% and recovering Wednesday's large dip, while the very large Tokyo market closed down a minor -0.1%. The ASX200 rose +1.0% yesterday, and the NZX50 Capital Index rose 1.2%.
The latest global compilation of COVID-19 data is here. The global tally is still rising, now 133,390,000 have been infected at some point, up +732,000 in one day, mostly in Brazil (+90,000), Turkey (+55,000) and India (+126,000). Global deaths reported now exceed 2,893,000 and +15,000 in one day. Vaccinations in the world are still rising fast, now up to 711 mln (+17 mln) and in the US half of their population (170 mln have had al least one dose and up +2.9 mln in one day) have now had this protection as they achieve a very fast rollout. The number of active cases there fell to 6,858,000 and down -10,000 overnight as some new hotspots emerge with problematic variants.
The UST 10yr yield is down another -2 bp to 1.63%. The US 2-10 rate curve is flatter at 148 bps. Their 1-5 curve is also flatter at +78 bps, as is their 3m-10 year curve at +162 bps. The Australian Govt 10 year yield is down by -2 bps at 1.66%. The China Govt 10 year yield is fimer again at 3.25%. But the New Zealand Govt 10 year yield is unchanged at 1.76%.
Oil prices are little-changed from this time yesterday, still at just on US$59.50/bbl in the US, while the international price is now just on US$63/bbl.
The Kiwi dollar opens today marginally firmer at just on 70.5 USc. Against the Australian dollar we are unchanged at 92.2 AUc. Against the euro we are also little-changed at 59.2 euro cents. That means our TWI-5 opens today a little firmer at 72.8.
The bitcoin price will start today at US$57,660 and up+2.6% from this time yesterday. Volatility in the past 24 hours has been moderate at +/- 2.2%. 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 ».