ECB cuts rates, to buy bonds; euro falls with CDS spreads; German factory orders rise; US service sector expands, exports grow; iPhone 6 to have tap-to-pay; NZ$1 = US$0.831, TWI = 78.9

Here's my summary of the key news overnight in 90 seconds at 9 am, including big news from Europe today.

The ECB announced this morning that it would cut its benchmark policy rates further and start a bond buying program. The ECB cut its main policy rate from 0.10% to a new low of 0.05% and its deposit rate to -0.2% from -0.1%.

The Bank also is to start buying asset backed securities and covered bonds next month. It's a new €700 billion program. They are going to buy a wide range of assets designed to boost credit to the private sector including residential mortgage backed securities and other securities backed by loans to the real economy. But there is no QE, where the ECB buys sovereign bonds.

These moves are unprecedented but they also appear to fall short of the broad, large-scale bond purchases advocated by many economists to prevent stagnation in the euro zone.

The euro fell sharply. CDS spreads we monitor daily showed that investment grade spreads are now suddenly lower in the euro zone than equivalent US CDS spreads.

Meanwhile, German factory orders rose +4.6% in August, the strongest monthly rise in German industrial output in over a year and an 'encouraging signal' for the economy, Germany's official statistics agency said overnight.

In the US, their trade balance for July came in quite a bit better than expected on stronger exports, and productivity was up in the June quarter. The latest assessment of their giant services sector shows that it expanded quite fast in August. Another large survey said the same thing.

But two American labour market reports out overnight weren't quite as good as was expected. The pre-cursor ADP employment survey indicated 204,000 new jobs were added last month - a small undershoot - and the level of initial unemployment claims were slightly higher than expected last week.

It is also worth pointing to a massive US Fed survey released overnight on American consumer finances. That shows that the income and wealth gaps are widening. It also showed debt decreasing for the low income parts of the survey - as they lost their homes to foreclosure.

And Apple said overnight that it intends to include tap-to-pay technology in its coming smart watch and next iPhone, as it pushes on into digital payments. But these services won't be in place until next year.

The UST 10yr benchmark bond yield rose marginally again and is now at 2.44%.

The price of oil and gold both rose today. The US oil price is up about $1 to US$94/barrel and the Brent benchmark is now just below $102/barrel. Gold is basically unchanged, now at US$1,269/oz.

We start today with our currency a little lower after the ECB action. We are now just on 83.1 USc, 88.8 AUc and again the lowest in 2014, but the TWI is up at 78.9 after gains against the euro and UK pound.

If you want to catch up with all the changes yesterday we have an update here.

The easiest place to stay up with today's event risk is by following our Economic Calendar here »