Here's my summary of the key news overnight in 90 seconds at 9 am, including news of weakening Chinese trade.
But first, it seems the latest FOMC minutes released a few minutes ago are dampening speculation of seeing the first taper at the September meeting.
Many Federal Reserve officials want to see more signs employment is picking up before they’ll begin slowing the pace of its monthly bond purchases.
Minutes from the June meeting show about half of Fed officials believe the central bank should end its US$85 billion-a-month bond-buying program by the end of this year. But don't forget many of the more hawkish FOMC members aren't voting members. Bernanke is due to speak about now.
The release of these minutes caused a flurry in stock markets and in exchange markets, but they quickly settled down.
Of more lasting importance, inventories at US wholesalers unexpectedly declined in May by the most since September 2011 as sales surged, pointing to a pickup in orders and production. But declining stocks dampens the GDP growth calculations before the following pickups, so some see the upcoming Q2 GDP result will be softer than previously expected.
US oil inventories are down on rising consumption, and the international oil price up, now over US$106 / barrel.
Rising yields on US Treasuries may bring a deficit reduction option for the US government. Those rising yields are causing prices for those bonds to fall, so it has been proposed that the Federal Government buy them back at a discount, thereby reducing their liabilities and taking a 'gain' on them. Up to US$450 billion could be netted this way, it has been suggested.
In important data out overnight, China’s exports and imports unexpectedly fell in June, underscoring the severity of the slowdown in the world’s second-biggest economy as the new leadership reins in credit growth.
The NZ dollar starts today at 78.2 USc, 85.5 AUc, and the TWI is at 74.7.
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