90 seconds at 9 am: Signs Bernanke may step down; US housing starts higher, CPI low; Deloitte fined and barred in NY; dairy prices rise; NZ$1 = US$0.800, TWI = 74.2

90 seconds at 9 am: Signs Bernanke may step down; US housing starts higher, CPI low; Deloitte fined and barred in NY; dairy prices rise; NZ$1 = US$0.800, TWI = 74.2

Here's my summary of the key news overnight in 90 seconds at 9 am, including news volatility is rising.

Main markets have nerves ahead of tomorrow's Fed meeting announcements. Markets are shameless in their 'wish' for QE to continue and perhaps they have reason to be worried.

About US$500 billion of annual growth in the US economy is being supported by a US$650 billion US Federal government deficit spending, and the Fed's US$1.5 trillion balance sheet that grows by US$85 billion per month. It is hard not to conclude that growth might be smaller - or non-existant - without the money printing.

Markets are expecting the Fed to announce tomorrow that they will slowly taper off of their $85 bil/mth QE starting in December this year. We will see. In fact by December we might even have a new Fed boss.

However, US housing starts rose in May to a five year high. And the recently falling US CPI stabilised in May, up 0.1% and evidence that deflation is not imminent.

In New York, stocks are higher, up 1% in mid-day trade. Gold is down to levels last seen in late 2010. Oil is up.

Staying in New York, activist regulator Ben Lawsky - someone we have followed on Top 10 - has made another bombshell announcement. He has fined Deloitte Consulting US$10 million and banned them from advising banks in New York for their role in advising British bank, Standard Chartered. More crackdowns on the professional advisory industry are expected from his office.

Hong Kong has opened a rate fixing case against HSBC and others.

In Europe, new car sales fell to their lowest level in two decades in May as the deepening recession there hurt demand.

After three consecutive declines, dairy prices have stabilised in the latest Fonterra auction, with prices in US$ up 1.1% from the previous auction. In NZ$ the rise is 0.9%. On an annual basis, the rise is a substantial +58% in either currency.

Today we get the first quarter balance of payments results and learn how our current account deficit has been tracking. We will have that result at about 10:45am this morning as soon as it is released.

The NZ dollar starts today at 80.0 USc, 84.3 AUc and its highest level since the end of December 2008, and the TWI is at 74.2.

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