Here's my summary of the key issues that affect New Zealand overnight with news of more turmoil in the oil markets.
Firstly, the American economy likely grew at a much stronger pace in the September quarter than previously reported. Data out overnight showed spending in their giant services sector expanding at a brisk pace, well ahead of what was expected. Many key components were up 5% and 6% over the same period a year ago.
American mortgage applications jumped again by a healthy margin.
All this good news is likely to result in a report of a much lower US Federal budget deficit for November which will be reported early afternoon NZ time.
China’s annual consumer inflation eased to a five-year low of 1.4% in November. And the growth in Chinese new-car sales fell to its lowest level in almost two years, amid a broad slowdown in the world’s largest car market and their economy generally, one that has crimped car sales and left some manufacturers with high numbers of unsold cars on dealer lots.
In New York, UST 10yr bond yields held steady at their lower level after yesterday's fall and are now at 2.21%. New Zealand swap rates for terms above 4 years are now at their lowest levels in more than 15 months.
Energy and climate-related issues have hit the fore overnight. A key official in Australia has said they will not sign up to the next global climate deal in 2015 if it will put the country at a disadvantage to trade competitors. And the Canadians are saying similar things.
The oil price has fallen sharply again and is now under US$61/barrel and the Brent price is at US$64/barrel. These are fresh five-year lows and this time surprisingly high American crude and petrol stocks triggered the falls. The rise in their local production is overwhelming their demand and alternatives are changing the nature of overall energy demand. The average pump price in the US last week was NZ$0.918/litre. The New Zealand equivalent is NZ$1.999. Opec has slashed its forecast of demand for crude next year, to levels well below what they are currently pumping.
In Australia, energy demand is falling to the point where operators are considering mothballing electricity generation facilities.
And Airbus has admitted it may have misjudged demand for its A380 superjumbo. It is considering following Boeing and shutting production of doubledecker aircraft sooner than planned. They did not take any orders for the A380 in 2014.
All these reductions in energy prices may well speed up the US Fed's plans to raise interest rates, contrary to what may believe.
The gold price is basically unchanged today at US$1,228/oz level.
Meanwhile our currency held its overnight levels. We start today at 77.1 USc, 92.9 AUc, and the TWI is at 77.5.
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 »