Here's my summary of the key events overnight that affect New Zealand, with news today that is mainly about public anti-corruption efforts.
Firstly, the IMF issued a report on worldwide corruption, and unsurprisingly noted the way it undermines trust and growth. It claims public sector corruption siphons US$1.5 trillion to US$2 trillion annually from the global economy in bribes and costs far more in stunted economic growth, lost tax revenues and sustained poverty. They did not review private sector corruption.
Then the US reported that its federal government had a US$106 bln budget surplus in April. That seemed good, but it is down from a $156 bln surplus in the same month a year ago. They are on track for a full year deficit of US$511 bln, slightly higher than the previous year. In perspective, their government budget deficit will be less than 2.8% of GDP.
In the US, Google said it will ban all ads from payday lenders. It said the move was to protect its users from such lending, which often leads to unaffordable repayment terms and financial harm.
In Australia, its prime minister was 'named' in the Panama Papers - but only for a brief exposure as an outside director in a mining company from 1993 to 1995.
In Europe some very large banks are purging their customers in large numbers, trying to rid themselves of exposure to corruption-tainted funds. Each of UBS, Barclays and Deutsche Bank have apparently culled about 25,000 customers. It gives you an idea of the scale of the problem. The move could see up to 40% of all their customers forced off their books.
And China is reportedly getting ready to abide by an OECD plan to clamp down on the transfer pricing rort used by most multinational businesses. Bringing China into the international effort will make a major difference.
In New York the benchmark UST 10yr yield is slightly lower today at 1.74%. Locally, although swap rates rose some, they flattened as well. In fact, they are now their flattest in a year.
The oil price is higher today with the US benchmark now at $46/barrel and the Brent benchmark just over US$47/barrel.
And the gold price is up as well, now at US$1,272/oz.
And finally today, the NZ dollar will start more than 1c higher today after yesterday's RBNZ Financial Stability Report at 68.4 US¢, at 92.5 AU¢, and at 59.8 euro cents. The TWI-5 index is now at 71.6.
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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