Here's my summary of the key news overnight in 90 seconds at 9 am, including news February ended on a generally positive note.
All eyes are currently on the geo-political tensions over the Ukraine and the Crimea, but on the economic front the news is more sanguine.
But the Americans have reduced their estimate of growth in the final quarter of 2013 to 2.4%. That was down sharply from the 4.1% rate in the third quarter and was due to weaker consumer spending components. These make up the bulk of what goes into US GDP.
In New York, equities ended February at a record high, and bond yields ended down. The benchmark UST 10 year finished at 2.65% having never gotten even near the 3% level some were expecting.
Gold actually rose more than 5% to end the month at US$1,325/oz although it was softer during last week. Oil also rose about 5% in the month, but all of that was in the first two weeks - from then, it has been stable.
Equities rose a bit less than 4% over February with generally good results being reported. Over the weekend, Warren Buffett's Berkshire Hathaway result was revealed and there were profit jumps there too to new records. Despite that, his results trailed the S&P500.
In China, the official large-firm PMI came in at 50.2, only just in expansion territory and down of the previous result. China is also widening the bands of its managed float for its currency. A more volatile exchange rate will likely result.
In Australia, the RBA is expected to leave their cash rate on hold tomorrow at their regular monthly review. While there are concerns about their domestic economy and looming labour market tensions, things have been working reasonably well recently. However, that view will be tested later in the week with new key data. December GDP figures come out on Wednesday, which are forecast to show only modest growth. And there are growing worries about jobs in the wake of Qantas announcing that 5,000 jobs are to be axed.
The next RBNZ review is on Thursday next week.
The NZ dollar rose steadily as last week progressed and we start today at 83.9 USc, 94.0 AUc and the TWI is at 78.7.
If you want to catch up with all the changes on Friday, we have an update here.
The easiest place to stay up with today's event risk is by following our Economic Calendar here »
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6 Comments
Meanwhile, in the real world, reality intrudes:
http://www.theguardian.com/environment/earth-insight/2014/feb/28/global…
They are from the east and it looks like Russia is going to offer them passports. They will be alot better off as the wages in Russia are alot higher than the Ukraine.
They never speak Russian in the west of the Ukraine as people won't serve them. They speak Russian Ukranian, German, French and English.
Ukraine sounds like a mess, they are big fans of Putin, and know he will protect them.
Im thinking that Germany will play a big part in what ever happens in the Ukraine.
As Russia threatens Crimea, one of the Ukraine’s main export routes for the millions of tonnes of grain the country exports every year, there is more at stake than regional sovereignty.
The cost of the loaves on our tables could shoot up should supplies from Europe’s breadbasket be effectively choked off in the Crimea’s strategic port of Sevastopol or the Black Sea port of Odessa, experts have warned. Ukraine is of vital importance to global food supply, ranking only behind the US by some estimates in global grain production.
http://www.telegraph.co.uk/finance/commodities/10671764/Commodities-Rus…
Abdel Fattah said Egypt had imported around 880,000 tons of wheat from Ukraine since July.
http://news.yahoo.com/ukraine-turmoil-not-disrupt-egypt-wheat-imports-o…
http://www.alibaba.com/showroom/wheat-exporters-from-ukraine.html
El Nino fears, Ukraine freeze add to wheat jitters
Concerns, stoked by falling US crop condition, over prospects for world wheat supplies received further support in a caution over the threat from El Nino to Australia's crop, and of winterkill in Ukraine.
Agritel warned that cold weather, which US officials have identified as hurting wheat seedlings in Plains states such as Kansas and Oklahoma, has damaged crops too in Ukraine, where warm weather for much of the winter has limited snow cover.
"The cold wave recorded last week in Ukraine has certainly damaged winter crop," said Paris-based Agritel, which has an office in Ukraine.
http://www.agrimoney.com/news/el-nino-fears-ukraine-freeze-add-to-wheat…
Ukraine fears lift corn, wheat prices. Soybeans rise too
Farm operator Trigon Agri may believe that Ukraine's unrest may end up being good for the country's agriculture sector.
But, as pro-Russian militia appeared in Crimea, in southern Ukraine, investors were worried there may be more than a few bumps on the way, fostering a revival in prices of both corn and wheat.
"The hostility in Eastern Europe continues with an armed takeover of an airport in Crimea," CHS Hedging said. (In fact, it may be two.)
"Traders are watching these events closely as many bushels of grain are handled at nearby Black Sea ports."
US Commodities said: "The unrest in Ukraine has traders nervous about exports out of that region."
http://www.agrimoney.com/marketreport/ukraine-fears-lift-corn-wheat-pri…
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