Here's my summary of the key events overnight that affect New Zealand, with news that Australia's investment banks have been outed as an ethics-free industry.
Firstly in the US however, the rate of foreclosures hit a 'record low' in June, at least a new low since this data has been collected since 1998. Mortgage and credit card debt 'late payments' are also falling; the one area that is still struggling however is student debt.
Wholesale trade increased +1.9% in June which was a lot better than the market expectation of +0.5%.
But things are not looking so good on the productivity front - the relationship between labour inputs and outputs. Productivity fell in the June quarter by -0.5% as pay rates rose faster than output in their economy. An ageing population and the fading boost from rapid IT advances may be behind the data. But alternatively, it might be that the traditional way of measuring economic output may be deficient somehow. Certainly, part of the decline will be the recent faster rise in pay levels that is catching up some earlier restraint.
One consequence for underperformance on the productivity front; low official interest rates. It will be hard for the Fed to 'normalise' rates unless this improves.
In China, inflation eased slightly as price rises for some key food items leveled off a bit, particularly for pork. They were up +1.8% in July, down from the annual rate of +1.9% in June. On the other hand, producer prices were down -1.7% in July, but in the context of where they have been with falling producer prices, this is an improvement.
And staying in China, the retail sales of cars, sport utility and multipurpose vehicles climbed +23% to 1.6 million units in July, the biggest monthly percentage gain since February 2015. This has allowed a significant clearing of high inventories.
In Australia, ASIC has been probing investment bank behaviour and what they have found is "ugly". Not only do the heavyweights of Australia's financial system have difficulty in managing their conflicts of interest they also financially reward staff for potentially conflicted behaviour. Essentially, they talk ethically but act unethically. It is not clear yet how ASIC intends to fix the culture problem in investment banking
In New York, the UST 10yr yield is unchanged today at 1.58%.
The US benchmark oil price slipped a tiny bit overnight and is now under US$43/barrel and the Brent benchmark is under US$45/barrel.
The gold price is marginally higher at US$1,339/oz.
The NZ dollar is basically unchanged from this time yesterday at 71.6 US¢, at 93.4 AU¢, and at 64.4 euro cents. The TWI-5 index is at 74.8.
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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