Here's my summary of the key events overnight that affect New Zealand, with news the US Fed is in no rush to raise rates.
Today they kept their policy rates unchanged. They see their labour market improving even as growth in economic activity appears to be slowing. They also see households' real incomes rising at a "solid rate" and consumer sentiment remaining high even though household spending growth stays "moderate".
They seem happy that their price stability and job growth targets are on track, but have held their rates this time because inflation is below where they want it. There was one dissenter, the president of the Kanasas City Fed who wanted to hike now.
The door seems open for a June hike, especially given their positive review of the state of the US economy.
Markets rose on the news. Stocks are a little higher on Wall Street erasing a pre-announcement fall, and the US dollar is stronger.
The American trade deficit narrowed sharply to a one-year low in March, as both imports and exports fell, suggesting economic growth in the first-quarter was probably not as weak as currently anticipated.
And "pending home sales", a forward housing demand indicator based on contract signings, increased in March for the second consecutive month and reached their highest level in almost a year. Only in the West region was there a decline in contract activity last month.
In China, the state of their bond market, their 'maturity wall', and the levels of leverage are all worrying investors.
In New York the benchmark UST 10yr yield slipped back on the Fed announcement and is now at 1.90%.
But the oil price is higher by $1/barrel, now just over US$45/barrel in the US, while Brent is now just over US$47/barrel. The World Bank has raised its forecasts for the oil price - while at the same time reducing its forecasts for agricultural commodities.
The gold price is up as well at US$1,250/oz. But this price is slipping following the Fed announcement.
And finally today, the NZ dollar opens little lower are we head into the RBNZ rate announcement, now at 68.4 US¢, at 90.2 AU¢, and at 60.5 euro cents. The TWI-5 index is now at 71.7.
Now, its all eyes on the RBNZ rate decision at 9 am.
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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