Here's my summary of the key events overnight that affect New Zealand, with news equities are dropping as commodity prices slide.
Today's dairy auction will have surprised and disappointed many. Another price fall was recorded with overall prices down -2.9% in US dollar terms and down -2.5% in New Zealand dollar terms. Prices are now at a seven month low.
The futures market turned out to be a poor predictor of this result. In the end WMP prices are basically unchanged from the prior auction, but SMP was down -2.5%, butter down -2.8% and cheese down -5.6%. There are few positives the dairy industry can take from this auction. Hopes of an upturn have been dashed.
In the US, their advance retail sales number for February showed a minor decline. It actually came in better than markets were expecting and better than for January, but it was a decline none-the-less and not inspiring. But there were revisions down for the prior month and that didn't help sentiment. Reasonably good factory sales and inventory levels - data for January - didn't help the market mood either. Nor did a big improvement in the New York Fed's huge factory sentiment survey, coming in way better than every observer's forecast.
In Britain, their serious fraud office has dropped its investigations into the giant London currency markets. They identified problems, but felt they didn't have enough proof to win any convictions.
Speaking of fraud, the official government auditor in Nigeria has told lawmakers there that US$16 bln is missing from their national oil company. And that comes after reports US$100 mln was stolen from the Bangladesh central bank
China is moving to control its currency outflows with a tax on currency transactions: a Tobin Tax. The plan is at an early stage and no action has been taken yet, but their law is being amended to allow it. It would become the first major country to go down that route; their objective is to retrain the activities of their own citizens and slow the leakage they have been seeing recently. When - or if - they implement it, it will be instructive about how it restrains normal commercial hedging practices and ordinary foreign trade.
The iron ore price, which just a week ago was surprising us with a bounce, is now in its sixth consecutive day of decline, unable to sustain the optimism.
In New York the benchmark UST 10yr yield is unchanged in mid-day trade at 1.96%.
The oil price is lower again today and now at US$36/barrel in the US, while Brent has slipped under US$39/barrel.
The gold price is falling as well and down US$10 on the day to trade now at US$1,234/oz.
The NZ dollar continues to follow these commodities down. The NZD starts today at 65.9 US¢, at 88.4 AU¢, and at 59.3 euro cents. The TWI-5 index is back down to 69.9 and almost at a six-month low.
If you want to catch up with all the local changes yesterday, we have an update here.
The easiest place to stay up with event risk today is by following our Economic Calendar here ».
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