Wall Street closed; G20 accomplishes nothing; Hong Kong goes 'localist'; Japan readies more stimulus; 'low rates are a trap'; EU retail shines; UST 10yr yield at 1.61%; oil and gold up; NZ$1 = 73.1 US¢, TWI-5 = 76.5

Here's my summary of the key events overnight that affect New Zealand, with news expanding service activity is buoying many key economies.

It is a holiday on Wall Street today, so key data flows will be light. It might also be worth noting that there are now only 57 days until the US presidential election.

The G20 meeting of world leaders has ended in China, an inconclusive affair marred by Chinese attempts to dominate everything. Nothing of substance was resolved or decided. But at least leaders are talking together, personally.

Down the road in Hong Kong however, six 'independent' MPs have been elected to their Legislative Council, securing about 20% of the vote despite official pressures against them, and they are expected to annoy Beijing by calling for 'localist' policies. 'Localists' gained in this election, Beijing supporters gave ground. Beijing is in no mood to tolerate anything but the party line, so this may spell trouble for Hong Kong.

In Japan, their central bank governor signaled a readiness to ease monetary policy further using existing or new tools, and rejecting growing market concerns that the bank is reaching its limits after an already massive stimulus program. We will get to hear their plans on September 21, the day before the US Fed and the RBNZ reviews.

India's departing central bank governor warned overnight that central bankers are in a low interest rate trap. Once you let yourself in, you can't get out, he says. A lesson perhaps for New Zealand here.

There were some key services PMI data released overnight and they were generally expansionary. In the US, they slipped a little to a six month low. In Japan there was no growth. In China, they improved further. The most impressive data was out of Europe where the expansion is holding at a healthy level.

Reinforcing that, Euro-zone retail sales for July came in much better than analysts were expecting, growing +2.9% year-on-year.

In New York markets are closed. But elsewhere, trading shows the UST 10yr yield up slightly to 1.61% today.

The oil price is up by another US$1 with the US benchmark price now just over US$45 a barrel, while the Brent benchmark just over US$47.50 a barrel.

The gold price also gained, but only slightly, now at just over US$1,326/oz.

The New Zealand dollar is marginally higher today as well, holding on to the rises we saw yesterday especially against the greenback. It’s now at 73.1 US¢, 96.3 AU¢ and 65.5 euro cents. The TWI index is still at 76.5.

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 ».