Here's my summary of the key news overnight with news of an important deal on trade ahead of both the G20 meeting and TPP negotiations.
But first, in a paradoxically good development for the American economy, workers there quit their jobs in September at the fastest rate in over six years, and the number of new claims for jobless benefits rose last week. But their extended sub-300,000 run is the longest stretch since 2000. Firms are well past a cycle of elevated layoffs that began in 2008.
In China however, data out overnight disappointed most observers. Factory production rose +7.7% from a year earlier, the second weakest pace since 2009. Investment in fixed assets such as machinery expanded the least since 2001 from January through October, and retail sales gains also missed economists’ forecasts last month. These numbers cast a pall over equity markets worldwide.
And in somewhat of a surprise move overnight, India and the US have come to an agreement on India’s massive food stockpiling program. That clears the way for India to ratify the Bali World Trade Organization agreement. India seems to have changed very little of the Bali agreement except getting a carve-out for its rice subsidy arrangements, so there seems little now stopping ratification.
In New York, UST 10yr bond yields made back all yesterday's decline and a bit more and are now at 2.36%. Our swap rates seem to be on the rise again, having bottomed out at the beginning of last week.
The oil price dropped sharply today and at one point a few hours ago was below US$75/barrel with the Brent price at US$78/barrel. That Brent price is now below $80 a barrel for the first time since 2010, as more evidence of a slowdown in China's resource-hungry economy reinforced an OPEC warning of a fall in demand next year.
The gold price is up marginally at US$1,165/oz. Gold demand in China shrank for a third quarter as slumping prices failed to boost the purchases of bars, coins and jewelry in the world’s biggest user and officials pressed on with a nationwide anti-graft campaign.
The NZ dollar has held its own against the US dollar and is still at 78.9 USc, at 90.5 AUc, and the TWI at 78.1. We have however risen today against the British pound and are now back above 50p.
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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