Bernard Hickey details the key news overnight in 90 seconds at 9 am in association with Bank of New Zealand, including news European leaders remain divided on the eve of a summit supposed to agree and announce a plan to save the European financial system.
Germany said it was opposed to the European Central Bank buying more Spanish and Italian government bonds to prop up the market. See more here at Reuters.
Italy's cabinet is divided over demands from France and Germany that it extend its retirement age to 67 from 65.
Deals have yet to be done to agree the size of the losses banks will take on Greek bonds. See more here at Bloomberg.
The details of how an expanded EFSF (European Financial Stability Fund) will operate and be financed have also not been finalised.
Also, the details of how Europe's major banks would be capitalised have yet to be agreed. The banks are reluctant to raise new capital and are instead talking about calling in more than 1 trillion euros of loans.
A finance ministers meeting designed to come up with the details was cancelled at the last minute. UK Prime Minister David Cameron canceled a visit to New Zealand to attend the summit.
US stocks fell 2% overnight on worries about the European crisis and after US consumer confidence slumped to its worst levels since March 2009. See more here at Bloomberg.
The New Zealand dollar fell in line with these reduced appetites for riskier currencies and worries about what the European crisis might mean for global economic growth and commodity prices.
It fell to 79.7 USc from as high as 81 USc yesterday. See the BNZ currencies report here on our site.
Weaker than expected Consumer Price Index Inflation mean that economists now see the Reserve Bank holding the Official Cash Rate at 2.5% until June next year rather than March next year. See Alex Tarrant's article here.
Fonterra's decision to lower its forecast milk payout also weighed on sentiment. See more here.
No chart with that title exists.
(Updated with US market close and links)
9 Comments
Fonterra ditches 'nonsense' milk price forecast
Fonterra braced dairy farmers for a bigger fall in milk prices this season than it feared, warning that the international market had not revived as it had hoped, and scrapping a forecast decried as based on "nonsense" thinking.
http://www.agrimoney.com/news/fonterra-ditches-nonsense-milk-price-fore…
Also physically ditching milk because of the gas leak.
http://www.stuff.co.nz/business/industries/5851343/Two-days-to-fix-gas-leak-crippling-firms
I heard independently of this that $20M of milk per day is being dumped.
Hope those of you living in Auckland don't expect bread until it is fixed, I have been advised that what is on the shelves now is all there is until the gas is up an running again.
Struth...!
"One in 10 Australian households are being tipped toward poverty as job insecurity grows in an economy divided by increasing gaps in wealth and opportunity, new reports say.
Housing costs are reaching crisis point for many, pushing hundreds of thousands of people into hardship and forcing up demands for help from community organisations.
"The evidence is mounting of a growing divide with more people hitting hard times and falling into poverty," Australian Council of Social Service chief executive Cassandra Goldie said.
The Australian Council of Trade Unions, concerned at the impact of casual and part-time jobs, contracting and similar arrangements, has launched a national inquiry into the spread of "insecure" employment.
The growth of disadvantage and poverty has been highlighted in several new reports and underwritten by Occupy protests in major cities that ended in violence as police evicted protesters from camps in Sydney and Melbourne."
http://www.nzherald.co.nz/employment/news/article.cfm?c_id=11&objectid=10761426
What if too many decide to come back across the ditch!
The deadly disease that will continue to eat away at the emu....
Safe as the aussie housing mart......!
"House prices will continue to drift lower over the next year, said ANZ Bank, as increased caution about borrowing takes its toll on home sales.
"Amongst a turbulent global economic environment, the national housing market continues to soften," said ANZ economics in their latest Australian Housing Snapshot, released today. "The housing market has also been hit with a behavioural shift towards increased household caution."
http://www.smh.com.au/business/house-prices-will-keep-dropping-anz-20111026-1miyq.html
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.