Here's our summary of key economic events overnight that affect New Zealand with news signs of caution are showing up in all sorts of markets.
But first, prices held in the overnight dairy auction - or at least they did in US dollar terms. But with the rising Kiwi currency, this latest event brought overall prices -2.0% lower in New Zealand dollars. The key WMP and SMP prices were virtually unchanged in US dollars. The best performer was Cheddar cheese, up +1.2% in US dollars but even that was not enough to record a gain in NZD. Overall the changes are not enough to alter any farm gate payout forecast.
In the US, retail sales last week were little changed from the prior week.
The latest data for Taiwanese export orders were strong, but no better than was expected.
In China, central planning for food security is in full swing, but despite that, they are importing vast amounts of food. You get a sense they know this is a strategic weakness, one they are working hard to address. But success looks far away.
Global trade is rising, and rising fast. The Baltic Dry freight index is now at a 20 month high, as demand for commodity cargoes, both 'hard' and 'soft', rise sharply.
Yesterday we noted that the WMO warned about unrestrained rises in global temperatures and the dire consequences. Today, the IEA is reporting that global CO2 emissions from energy-related activities will rise by +1.5 bln tonnes in 2021, the second-largest rise in history (after 2014), driven largely by rising demand for coal to be used for electricity generation. (Under policy guidelines introduced in 2018, New Zealand is contributing to this increase to run the Huntly coal-fired power plant.)
The release of the RBA minutes reveals that the Aussies no longer think the pandemic has done any long-term economic damage to them. It is quite a different outlook from the fears that existed at the start of the emergency.
On Wall Street, the S&P500 is down -0.8% in early afternoon trade, compounding yesterday's -0.5% decline. Overnight, European markets fell about -2.0% across the board. Yesterday, Shanghai ended down -0.1%, Hong Kong ended up +0.1%, but Tokyo set the European scene, down -2.0%. The ASX200 ended yesterday down -0.7%, and that was matched by the NZX50 Capital Index.
The latest global compilation of COVID-19 data is here. The global tally is still rising, now 142,304,000 have been infected at some point, up +661,000 in just one day, largely driven by rises in India where new lockdowns are underway. Global deaths reported now exceed 3,034,000 and up +11,000 in one day. Vaccinations in the world are also rising fast, now up to 921 mln (+14 mln) and in the US more than half of their population (209.7 mln) have had at least one dose as they keep up their fast rollout. More than a quarter have been fully vaccinated. The number of active cases there dipped to 6,860,000 and down -10,000 in a day.
The UST 10yr yield starts today at 1.56% and -4 bps lower. The US 2-10 rate curve is a little flatter at 141 bps. Their 1-5 curve is also flatter at +74 bps, as is their 3m-10 year curve at +155 bps. The Australian Govt 10 year yield is unchanged at 1.70%. The China Govt 10 year yield is also holding at just on 3.18%. But the New Zealand Govt 10 year yield is now at 1.66% and +4 bps higher.
The price of gold starts today at US$1778/oz and that is up +US$7 since this time yesterday.
Oil prices are softer, down -US$1 at just under US$62.50/bbl in the US, while the international price is just under US$66/bbl.
The Kiwi dollar opens today at just under 71.8 USc and unchanged from this time yesterday. Against the Australian dollar we are decidedly firmer at 92.9 AUc. Against the euro we are little-changed at 59.7 euro cents. That means our TWI-5 is still just under 73.6.
The bitcoin price will start today at virtually the same lower level they were at yesterday, at US$55,852 and a mere -0.4% lower, and almost the same as at this time on Monday. However, volatility in the past 24 hours has been highish at +/- 3.0%. 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 ».