Here's my summary of the key events over the weekend that affect New Zealand, with news that brisk hiring in the US slowed, but wage gains picked up.
US non-farm payroll data disappointed markets with its headline results. They added 160,000 jobs in April - undershooting expectations and well below the 208,000 created in March. Data for the prior two months were revised marginally lower as well. The jobless rate remained at 5% but average hourly earnings rose +2.5% and that was higher than markets were expecting. It is this healthy rise in pay that will catch the Fed's attention and indicates strong rises in real incomes, and likely to underpin spending growth. It will give the Fed cover to push ahead with another rate rise.
China’s exports unexpectedly fell by almost -2% in US dollars in April as weak demand continued to weigh on the world’s second-largest economy, though the results were an improvement over the first quarter (they were up +4% in yuan). April imports dropped -11% in US dollars from a year earlier (but down only -6% in yuan), falling for the 18th consecutive month. That suggests their domestic demand remains weak despite a pickup in infrastructure spending and record credit growth in the first quarter.
In a series of sweeping royal decrees over the weekend, Saudi Arabia restructured most of its government bodies in the first moves of an ambitious plan to chart a new direction for the country. The decrees were among the first concrete steps in the plan, which was announced late last month. The plan, known as Saudi Vision 2030, is intended as a guide for the country’s development. It aims in part to reduce Saudi Arabia’s heavy dependence on oil, diversify its economy and improve the quality of life for Saudi citizens. The plan has a remarkable similarity to a major McKinsey report on the transformation the country needs.
Today's release of more Panama Papers reveals that ANZ appears in more than 7,500 of them reflecting the bank's extensive network in New Zealand, the Cook Islands, Samoa and Jersey. It has also revealed that a former board member of the Reserve Bank of Australia shielded his income from the Australian tax authorities. So far, no evidence any of this relates to New Zealanders.
And there is to be an Australian general election on July 2, with the Turnbull government seeking a fresh mandate after the leadership change nearly eight months ago. It comes as their economy faces voter uncertainty after the end of their long resources boom.
In New York the benchmark UST 10yr yield is slightly higher at 1.78%. The sharp falls we saw at the start of Friday's local wholesale interest rate swap market built to leave almost all terms with all-time record low rates, so they start today lower and flatter than at any time in the past 15 months.
The oil price is unchanged at just over US$44/barrel in the US, while Brent is now just over US$45/barrel.
The gold price is up US$17 to US$1,290/oz.
And finally today, the NZ dollar is not much changed, still at 68.4 US¢, at 92.8 AU¢, and at 60 euro cents. The TWI-5 index is now at 71.6. Yes, its still in the range it has been over the past eight months.
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 ».
We welcome your comments below. If you are not already registered, please register to comment
Remember we welcome robust, respectful and insightful debate. We don't welcome abusive or defamatory comments and will de-register those repeatedly making such comments. Our current comment policy is here.