US Crude oil reaches new 12-year low; copper sinks to 6-year low; PBoC ups defence of yuan; UST 10yr yield 2.13%; oil and gold fall; NZ$1 = 65.4 US¢, TWI-5 = 70.9

Here's my summary of the key events overnight that affect New Zealand, with news the oil price is teetering on falling below US$30 a barrel. 

The price of US Crude oil has reached a fresh 12-year low, dipping to US$30.05. This is its lowest level since December 2003 when it fell to US$29.89.

[Since writing this piece at around 7.30 this morning, the price of US Crude oil has fallen to US$29.93].

While analysts at most the major international banks have cut their 2016 oil forecasts this week, Standard Chartered has gone so far as to say oil could fall as low as US$10 a barrel. 

Supply remains robust, while demand continues to look fragile off the back of slowing growth in China. In fact, OPEC plans to export a record amount of oil from its southern oil terminals in February.

Nigeria's oil minister says market conditions have spurred a "couple" of OPEC members to request an emergency meeting for February or March. BP has also just announced plans to cut at least 4,000 jobs in the face of the oil crisis.

Concern over China's growth has also seen the price of copper fall to a six-year low this week.

Meanwhile, the People's Bank of China has stepped up its defence of the yuan overnight. It's repeatedly intervened in the offshore market, buying the currency in Hong Kong and sparking a record surge in the city's money-market rates to deter bearish speculators.

By hiking the cost of borrowing yuan, it's trying to curb bets on a rapid depreciation of the currency and close the gap between onshore and offshore rates.

The cost of insuring Aussie bank bonds, as measured by the credit default swap spreads, is rising steadily. This is not so much because of the banks' own positions, but the fact their debt is part of a market that includes Aussie miners whose prospects look poor.

This is affecting how markets see Australian investment grade debt; the poor outlook directly affecting what New Zealand banks pay for money.

Back in New York, the UST 10yr yield benchmark has fallen 5 basis points to 2.13%.

The price of Crude oil is sitting at US$30.05 a barrel, having bounced between US$30 and US$32 overnight. The price of Brent crude has fallen to US$30.50.

The gold price continues to slide, and is now at US$1,087/oz.

The New Zealand dollar starts the day slightly weaker than this time yesterday, at 65.4 US¢, 93.6 AU¢ and 60.2 euro cents. The TWI-5 is pretty much unchanged at 70.9.

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

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