Here's our summary of key economic events overnight that affect New Zealand with news of no respite from ever higher shipping costs and higher food costs.
But first in the US, the number of people claiming jobless benefits fell last week to 288,000, and the number of people on these programs is down to 2.6 mln. Both represent substantial progress. (We should note however that seasonally adjusted data is much higher than the actual data.)
All eyes are on tomorrow's non-farm payrolls report. In the meantime American factory order data brought no surprises with a small rise in July from a healthy June level.
The US trade deficit didn't widen in July, and given the track of the past eight years, this is somewhat unusual and better than analysts had expected. Their exports rose faster than their imports.
Canadian building permit levels fell in July, and that was also not expected.
We have previously noted there is an election campaign underway in Canada. One of the planks of the ruling party is for a 3% surtax on profits of large banks and insurance companies. Doom scenarios are being rolled out there by opposition forces. But Australia has had a "major bank levy" on profits for some time and they have barely noticed it.
In Europe, they reported that producer price inflation rose by more than +12% in July from a year ago, faster than expected and at an accelerating rate. The range is very wide from a dramatic explosion higher in Ireland to negligible in Hungary. In Germany it is a +9.4% jump, France +8.6%.
Ireland has serious imbalances building and their central bank governor unloaded on their government about the way they are dealing with them. He is worried. (Their central bank Governor used to be our Treasury Secretary until 2 years ago.)
Globally, the cost of freighting a container just keeps on rising, now averaging NZ$14,250 and a rise of +1.7% in a week. That is up +345% in a year.
And there is no letup in rising food prices globally. Worldwide, there is a shortage of labour to harvest, another contributor to high prices. Automation is on the way now.
In Australia, July delivered a back-to-back fresh record highs for the merchandise trade surplus. It was +AU$12.1 bln and well above most analyst's expectations. Their June surplus was revised up to AU$11.1 bln, from the initial estimate of AU$10.5bn.
And staying in Australia, there were another 1288 new community cases in NSW yesterday with another 1151 not assigned to known clusters, so they remain completely out of control. They now have 20,068 locally acquired cases. Victoria is reporting another 176 new cases yesterday, so it is bad there too. Queensland is now reporting two new case. The ACT has 12 new cases. Overall in Australia, more than 37% of eligible Aussies are fully vaccinated, plus 23% have now had one shot so far.
Wall Street has started its Thursday session with the S&P500 up a minor +0.1% in afternoon trade although this is lower than earlier. Overnight, European markets were up, all in a narrow band between +0.1% and +0.2%. Yesterday, Tokyo closed up another +0.3%, Hong Kong closed up +0.2%. Shanghai closed up +0.8%. The ASX200 ended its session the outlier, down -0.6% but the NZX50 ended up +0.3%.
The UST 10yr yield opens today at just under 1.30% which is down -1 bp from this time yesterday. The US 2-10 rate curve is now at +108 bps and just a little flatter. Their 1-5 curve is unchanged at +71 bps, and their 3m-10 year curve is marginally flatter at +125 bps. The Australian Govt ten year benchmark rate starts today at 1.21% and little-changed. The China Govt ten year bond is at 2.85% and also little-changed. And the New Zealand Govt ten year is now at 1.83% and holding yesterday's big rise.
The price of gold is down again and by -US$3 from this time yesterday, now at US$1810/oz.
Oil prices have risen +US$2 today so in the US they are now just on US$70/bbl, while the international Brent price is just on US$73/bbl.
The Kiwi dollar opens today firmer again, up +40 bps to be just on 71.1 USc and its highest since mid-June. Against the Australian dollar we are up at 96.1 AUc. Against the euro we are firm too at 59.9 euro cents. That means our TWI-5 starts today at just on 74 and right at the top of the 72-74 range of the past ten months.
The bitcoin price has risen +1.1% from this time yesterday to US$49,313. Volatility in the past 24 hours has been moderate at just over +/- 2.4%.
The easiest place to stay up with event risk today is by following our Economic Calendar here ».