Here's my summary of the key news overnight in 90 seconds at 9 am, including news of some more spooky new ad technology.
But first, following the World Bank, the IMF has cut its global growth outlook for this year and next, saying the prospect of the US Federal Reserve unwinding its easy money policies is aggravating a slowdown in emerging markets.
Equities are pushing higher in New York however following slightly better than forecast earnings by Alcoa, the traditional first-reporter. The big US banks are next and markets seem to think their results will be good too.
American regulators are settling on tougher-than-Basel bank capital leverage standards, as concern over the Basel III rules grow.
In China, the favourite inflation number this month is 2.7%. Consumer prices rose by that amount in the latest official survey, up sharply from the 2.1% in May. But producer prices apparently fell 2.7% in the month, indicating producers have little pricing power. Food prices account for the difference; interestingly sheepmeat prices are up 15% and beef prices up nearly 30% over the past year.
Last week we reported the new Sky Germany ad tool that can transfer ads directly into your head as you lean on a train window. Well this week even more spooky stuff from the ad industry. New cameras in public ad screens will tailor ads for people in the vicinity and report audience profiles to advertisers. Very Minority Report.
In Australia, an August interest rate cut is becoming more likely after business conditions fell to a four-year-low in June.
Trading, profits and employment conditions weakened, painting a "worrying picture of the Australian economy" according to the latest NAB survey.
They have brought forward their rate cut forecast from November to August. Its June business survey reported "very bad" conditions in the mining, retail and manufacturing sector despite lower interest rates and a falling Australian dollar. The index slipped from minus 4 in May to minus 8 last month.
The NZ dollar starts today sharply higher again at 78.7 USc, 85.7 AUc, and the TWI is at 75.3, which is more than a 3% gain in less than 3 weeks.
No chart with that title exists.
12 Comments
It looks like both of our biggest trading partners are in for a hard landing , so what does this mean for our little economy ?
In a best case scenario , we become the new lucky country and catch up with them on all the measures we lag such as per capita savings , wage rates , COL index , GDP growth , business confidence , infrastructure development , etc
I suspect that in a worst case scenario the impact of a downturn in Aussie will be felt sooner than a slowdown in China as we will see our exports being hammered because of the AUD/NZD xchange rate and we will redundant Kiwi mine workers returning home to get the benefit which they dont get over there
But first, following the World Bank, the IMF has cut its global growth outlook for this year and next, saying the prospect of the US Federal Reserve unwinding its easy money policies is aggravating a slowdown in emerging markets.
One can only wonder what impacted previous forecast failures - a lack of common sense? Read more
I talked to a friend in the forestry industry. He told me that the company he works for thinks it has 18 months at most before China stops buying as its economy will be shot. Then what?
He went on to talk about the wall of wood almost due to harvest from the massive plantings of the 1987 to 1993 period, of which we don't have the infrastructure to handle or the markets for.
Oh joy
Exactly. NZ was always going to win big if carbon trading became the default int'l CC mitigation regime because of our forest reserves. There is the benefit of an income stream for foresters whilst trees are maturing and once mature, if it becomes unprofitable to harvest, the income stream remains. Moreover, as pastoral farming becomes uneconomic (due to the fert/fossil fuel issue) one can plant that pasture - and again NZ would have had an income stream from it. Additionally, of course there is the potential of the crop with respect to energy/fuel.
If instead the world moves to a carbon tax regime there are only net negatives for us as a nation.
... the real negatives as a world (forget nation) are that we do nothing about carbon. Most of the issues on this site pale into insignificance if one takes the time to look at some of the latest data. Our leaders maybe porking the state of world finance, however this is nothing compared with what is loomng on the horizon re our climate chaos.
http://www.nzherald.co.nz/business/news/article.cfm?c_id=3&objectid=108…
Prospectus suggested range was: $2.05 to $2.65.
They have done well.
Um..David, I'm thinking Wheeler has been interfering with himself again, though the rock and the hard place are leaving him little room to indulge.
Petrol shocks, inflation, increasing consumer debt vs export earnings......all the while the Aus economy begins the slide....
No Sir not much room to move there.....he really should stop figeting so...it can lead to bad habits...like gambling.
Late yesterday morning i heard on the radio that NZ had signed a Free Trade Agreement with Tiawan. This agreement has been kept secret and there is an embargo on this news. However as we live in the internet age an embargo is pointless because this news has allready been published in the Chinees newspapers and so the news is out making the embargo pointless.
When the media obey an embargo in the age of the internet they are only punishing their own readers/viewers/listeners as they can go else where for the info.
Nonetheless, China will continue to surprise us in unexpected ways. Read more
China’s exports and imports both unexpectedly declined in June in a sign that weakness in global and domestic demand will intensify the slowdown in the world’s second-biggest economy.
Maybe Bill English didn't get the memo.
New Zealand’s economy is gaining momentum as consumer and business confidence improves and wages increase, Finance Minister Bill English said.
“A number of recent indicators confirm the economy is on the right track and the future is looking brighter,” English said in a speech in Wellington today. “We are seeing momentum building towards a stronger, more stable economy.”
and the cost of living is well under control.”
Aparently Billy Bob doesn't regard housing and food as components in the cost of living.........a liar or an idiot, though idiots are not usually openly smug.
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