US jobs jump, boost rate hike prospects; BIS says markets losing faith; China sets growth and restructuring targets; UST 10yr yield 1.88%; oil up, gold down; NZ$1 = 68.2 US¢, TWI-5 = 72.5

Here's my summary of the key events over the weekend that affect New Zealand, with news there is a higher likelihood American interest rates will rise, sooner.

The weekend release of their non-farms payroll data shows a rebound in US jobs growth, one that has cooled talk of a US economic slowdown, and raised talk of more Fed hikes in 2016. The level of jobs growth far outstripped market expectations, but wage growth there slipped slightly.

In the coming week when the ECB, the Bank of Canada and of course the RBNZ are all reviewing rates and assessing monetary policy settings (not to mention the US Fed, the Bank of England, the Swiss, Japanese and Norwegians all next week), the shaky start to the year shows that financial markets are losing faith in the "healing powers" of central banks according to the Bank for International Settlements.

Its a tough job, one that politicians don't seem to want to do, even if the central bankers can't quite meet their objectives.

Also facing a tough situation is China which acknowledges a battle ahead to keep its economy growing by at least 6.5% over the next five years while creating more jobs and restructuring inefficient industries. Its a point Premier Li made as he opened China's annual rubber-stamping parliament on Saturday. And they are going to try to do all this while capping energy consumption.

The BIS also has a view on the falling levels of China's foreign currency reserves. They say the persistent capital outflows from China since mid-2014 were probably driven more by local companies paying down their dollar-denominated debt in anticipation a stronger American currency, than investors ditching Chinese assets.

In Australia, ANZ is being taken to court over interest rate rigging charges, which they deny. The Australian regulator ASIC has commenced civil penalty proceedings against them for interest rate manipulation conduct. ANZ also face a class action over the issue. ANZ is not the only bank in the gun over these practices.

In New York the benchmark UST 10yr yield rose on the stronger US jobs report and will start the week at 1.88%.

The oil price rose as well and is at US$36/barrel in the US while Brent is at US$39/barrel.

The gold price went the other way, falling to US$1,259/oz. But it wasn't lower for all precious metals; platinum rose US$30/oz to US960, and the semi-precious metals rose too.

The NZ dollar will start the week noticeably stronger at 68.2 US¢, at 91.7 AU¢, and at 62 euro cents. The TWI-5 index is just on 72.5 and approaching its highest level for the year.

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

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