David Chaston details the key news overnight in 90 seconds at 9 am in association with Bank of New Zealand, including news that S&P have given the NZ Government a tick for the way it is approaching its 2011 budget, saying that it doubts there is much ‘fat’ in state operating costs. This may be setting the scene to remove the ‘negative watch’ status when the Budget is presented on May 19.
Overseas, inflation is picking up and is looking to be a bigger problem sooner in many big countries in 2011 than thought earlier.
China said its inflation rose from 4.6% in December to 4.9% in January. In the UK, inflation topped 4%. And in the US, policy makers are coming to grips with the problem that their stimulus is unsustainable, inflationary, but holds on to jobs. While the politicians choose the short-term benefits, Fed members are starting to lose faith in the existing policies. They have some very tough choices ahead, and they will affect us all.
In Japan, their central bank has raised its economic assessment for 2011 on better global growth prospects, and higher exports.
But in Europe, fourth quarter growth was much less than expected at just +0.3%. German growth was weather-affected, France’s economy stalled, and the PIIGS are deep in recession.
Such gloom is not affecting some big European banks however. British bank Barclays has reported a 32% rise in profits, although some of that was because they put a lid on staff bonuses.
The Dow is holding up, Gold is up to US1,372 / oz, oil futures are down sharply to US$84.15 / bbl, and the 30 yr Treasury bond yields fell to their lowest level in a week.
The NZ$ is weaker this morning against most currencies. It is currently sitting at 75.26 US cents
No chart with that title exists.
We welcome your comments below. If you are not already registered, please register to comment
Remember we welcome robust, respectful and insightful debate. We don't welcome abusive or defamatory comments and will de-register those repeatedly making such comments. Our current comment policy is here.