Here's my summary of the key news overnight in 90 seconds at 9 am, including news of a sinking NZ dollar and a sudden dip in swap rates.
But first, the number of Americans filing new claims for unemployment benefits unexpectedly rose last week, up by 11,000 s.a., but that probably does not signal a material shift in US labour market conditions as these claim levels remain near their pre-recession numbers. Besides, the week reported included a holiday day, and the unadjusted raw data saw a fall of 15,000.
The US Federal deficit came in lower than expected at US$129 bln in August. Analysts were expecting $133 bln, and the same month a year ago the deficit was US$148 bln. Tax revenues are rising and outlays are falling. There is now a good chance the full fiscal year to September deficit may be lower than $500 bln, a 26% improvement over 2013, and below 3% of US GDP.
China's consumer inflation rate in August was +2.0% a four-month low. On the other hand, factory-gate prices have now declined for 30 straight months in China, adding room for government stimulus to support the economy amid a property slump.
In Australia there was an astonishing labour force data release yesterday. There are warnings it was a rogue number and it looks like it was. A month after the unemployment rate hit 6.4%, it’s back at 6.1% with a remarkable 120,000 jobs created in one month. No-one seems to be taking it seriously.
The UST 10yr benchmark bond yield held at the 2.53% level. However overnight NZ swap rates took a noticeable tumble across the board, falling -4 to -6 bps.
The price of oil had a small bounce overnight. The US oil price is now under US$93/barrel and the Brent benchmark is now a tad over $98/barrel. The IEA cut its demand forecasts for 2015 overnight citing the European slowdown, and to a lesser extent lower demand growth in China. They also noted "robust non-OPEC supply growth".
Gold is unchanged, still at US$1,244/oz.
We start today with our currency lower against the US dollar but level-pegging against most other currencies. We are now just on 81.8USc and its lowest since early February; we are up against the Aussie at 89.8 AUc, and the TWI is at 78.4. It little to do with Graeme Wheeler's push against the NZD, rather all to do with a surging US dollar.
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 »
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