Here's my summary of the key overnight news in 90 seconds at 9 am, including news of a further retreat from risk.
As we reported yesterday, markets think the Chinese government is worried about surging house prices and are nervous about how they will tackle the problem.
It became clearer overnight that their central bank is holding back from providing liquidity that would support the housing rush, and that is causing their interbank lending rates to rise sharply.
At the same time, China took a significant step yesterday to deal with an explosion of borrowing among local governments by allowing more of them to issue short-term debt to help pay off maturing bonds and loans.
In the US, some key corporate earnings also worry investors. Caterpillar in particular disappointed, although there were below expectation results from some chipmakers too.
The two concerns - Chinese credit conditions and US earnings - have seen markets pulling back. In mid-day trade, New York equities are down about 0.5%, the oil price fell to US$95/barrel although it is up a bit since the low, and gold is down. US Treasury 10yr bond yields continue to fall - that is, Treasury bond prices are rising - with the yield now at 2.48%.
In Australia, the new government there has decided to give the RBA A$8.8 bln to replenish their depleted reserve funds. Some see these resources being used to defend their currency. The move however makes their budget deficit that much larger. Aussie inflation also came in higher than markets were expecting.
All this news has our currency down sharply on the overall retreat from risk.
The NZ dollar starts today at 83.9 USc, 87.1 AUc, and the TWI is at 77.0.
The easiest place to stay up with today's event risk is by following our Economic Calendar here »
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6 Comments
China is worried about excessive housing activity, we are not.
Vatican is worried about excessive housing activity, we are not.
Aussie rules. Hockey, not Hickey. A game we can all identify with.
Please note they do not even know how much is left in the coffers.
Data analyst at Dumpark , Timo Franz , has admitted to Sean Plunkett Radio Live that all the data for their Greenpeace sponsored report on the risks of an oil drilling spill near the New Zealand coastline came from .... Greenpeace !
... they were advised that they needn't approach the oil drilling industry itself , 'cos Greenpeace had all the facts necessary for the report .... so they didn't ... they did their graphics and modelling based solely on what their sponsor fed to them ....
Aha ha haaaaaa ..... only in NZ are we so gullible to vested interests , and to only getting half the conversation !!! .... Greenpeace's models have less meat on their bones than a Parisian fashion-show catwalk ....
As I said yesterday GBH the globe is awash with bought n paid for scientific results, while the Greenpeace Org is no different to the very people they target in terms of commissioning outcomes that serve their cause, I'd guess they figure it's fire with fire world .....sadly.
The truth in anything usually lies somewhere in the middle, with zealotry at opposing ends.
Funny thing is, it says more about apathy than it does about corruption
... as reported in the Daily Mail , Prof. Robin Dunbar , a psychologist at Oxford University ( UK ) has concluded that men's health and well being is enhanced greatly by meeting some male friends at least twice a week ... the meetings can be for sporting activities , or just gas-bagging over a cool pint or three ... The benefits from our meeting in person with our buddies is immeasurable to our happiness , apparently ..... even just from aimlessly sinking some brewskies together ...
This is a scientific research paper he has put up ....
... and the sponsor of his report is ..... ahhhhhhh ..... Guinness Brewery ..... ahem !
Someone still thinks Gold is the goer ! .... this one's from Wolly's old stomping ground ..
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