Here's my summary of the key events overnight that affect New Zealand, with news of renewed focus on bank sales cultures.
But first, the flash durable goods orders report for the US for August has come in better than expected. A decline from July was expected but in the end the data level-pegged the previous month. There were revisions to the July data however, generally marginally lower.
Bank culture, especially around sales targets and bonuses, is in the spotlight again. The Wells Fargo bank board has stripped its CEO's and another senior manager of their unvested equity awards worth more than NZ$50 mln and said they will not pay their salary while they investigate the bank's sales practices which have brought major reputational damage to their bank. They have lost their 2016 bonus as well.
This action comes days before the CEOs of the big four Australian banks appear before the Economics Committee to face questions about their own sales and bonus cultures. Wells Fargo's actions will embolden the Australian parliamentary inquisitors.
And a key US regulator has asked American banks to be careful about blanket cut-offs when they take actions to de-risk themselves under anti money laundering rules. The regulator is concerned about the impact on entire groups of customers or counties in riskier parts of the world, and said he will issue guidance on how this is to be approached.
In Germany, there are real concerns about the viability of their biggest bank, Deutsche Bank. The bank is fighting a fine of up to NZ$20 bln from the American Department of Justice and the size of the punishment is raising concerns over its capital adequacy. The weekly German paper Die Zeit reported that the German government is working on a bailout plan that might include them taking a 25% stake. But denials have been loud today - so loud, it might actually be true.
In China, their Golden Week holiday is about to start, and this involves the movement of enormous numbers of people. Just on their railways, they are expected to shift more than 110 million people, with more than 15 million on Saturday alone. Trips by car, bus and air are additional.
In Australia, the entire state of South Australia was without power for several hours yesterday afternoon, with the region hit one of the most extreme weather systems for 50 years. A mass blackout began about 3.30pm local time, plunging the Adelaide into darkness, grounding flights and causing havoc on the state's roads.
In New York the UST 10yr yield has fallen again today to 1.55%.
The US benchmark oil price is up $1 today, now just under US$46 a barrel, while the Brent benchmark is now just on US$47.50 a barrel.
The gold price has slipped slightly again, now at US$1,326/oz.
The New Zealand dollar is lower today than at this time yesterday by about ½ cent, now at 72.5 US¢, and on the cross rates it is at 94.7 AU¢, and 64.7 euro cents. The TWI-5 index is now at 75.5.
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 ».
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