Here's my summary of the key news overnight with what turns out to be a selection of downbeat economic items.
First up today, there was a globaldairytrade auction overnight and the results were flat. In US dollars, prices fell -0.3%, kept up by higher wholemilk powder prices as we indicated last week from the USDA monitoring. Volumes were down marginally from the previous few auctions, but considerably above the mid-year levels. In New Zealand dollars, there was a lift of +2.4% in overall prices. Fonterra and other observers say prices should start rising from here.
Secondly, there has been a very sharp fall late yesterday and overnight in the oil price. This follows reports that Saudi Arabia was cutting what it charges United States customers to remain competitive in that market.
Thirdly, matching some expected British moves, it looks like American regulators are going to file criminal charges against JPMorgan Chase for its role manipulating currency rates.
Back across the Atlantic, the EU has cut its growth forecasts in what is itself seen as a depressing move. Confidence in the ability of eurozone economies to work their way out of their stagnation is low.
Back in the US, the American trade deficit unexpectedly widened in September as exports hit a five-month low, suggesting slowing global demand could undercut economic growth in the final three months of the year.
New orders for factory goods also fell although factory order backlogs actually rose, and rose more than the new order falls.
In China, their major import-export trade fair in Guangdong showed a decline in orders year-on-year. Good external demand which helped buoy growth in the third quarter may not be sustainable in the final three months of the year.
In a further sign of the times, Macau casino revenues fell an amazing -23% in October.
Australia’s labour market is weaker than previously reported, their Stats Department said in a review released yesterday. That sent their currency lower and reinforced the expectation that the Aussie interest-rate pause will be extended. The RBA left rates unchanged yesterday.
Today, we get the New Zealand unemployment data for the September quarter. Markets are expecting our unemployment rate to fall slightly to 5.5%.
In New York, UST 10yr bond yields were flat in trade today and are at 2.34%.
As flagged earlier, the oil price took a big tumble yesterday and is now under US$77/barrel with the Brent price under US$83/barrel.
The gold price however was stable and is still at US$1,168/oz.
Out of all of this. we start today with our currency a little stronger. It is now at 77.7 USc and off yesterday's lows, at 89.1 AUc, and the TWI is at 76.5.
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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