Here's my summary of the key events overnight that affect New Zealand, with news of trouble in Hong Kong; a surprising number of the city's residents want to leave.
But first, the number of Americans filing for unemployment benefits was at 43-year low last week, pointing to sustained labour market strength.
But how long will the current economic expansion in the US last? They rarely run more than a decade straight and we are approaching that. So the odds are another downturn will occur in the next few years. Either that, or the expansion will become an all-time record, which does seem unlikely.
There is trouble brewing in Hong Kong. A quarter of the representatives elected to their Legislative Council want more independence from China, something Beijing is not happy about. And these renegades are getting more aggressive, poking the bear. This restlessness is showing up on the street; 40% of them want to leave. That is a lot of people; Hong Kong has a population of more than 7 mln, so potentially almost 3 mln people could be on the move if things deteriorate.
China's September exports fell -10% from a year earlier in US dollar terms, far worse than expected, while imports unexpectedly shrank - by -1.9% - after picking up in August, suggesting signs of steadying in the world's second-largest economy may be short-lived. This is a worry for many emerging economies heavily dependent on China.
In India, a good monsoon is putting downward pressure on prices, especially food prices. And that opens up the opportunity for them to cut their high official interest rate, currently sitting at 5.75%.
The Reserve Bank of Australia released its Annual Report yesterday and the most eye-catching element was the dividend they paid to the Aussie government - AU$3.2 bln, their largest ever. (See p 126.) For comparison, the RBNZ paid Wellington a NZ$ 140 mln dividend, down from NZ$ 510 mln the previous year.
In New York, the UST 10yr yield is down sharply, now at 1.74% following the release of the Fed minutes yesterday.
The US benchmark oil price is a little higher today, now just under US$50.50 a barrel, while the Brent benchmark is now just under US$52 a barrel. And this comes after it was reported that US crude oil stocks have risen more than expected.
The gold price is higher as well, up +US$4 and now at US$1,256/oz.
The New Zealand dollar has held yesterday's levels overnight, opening today at the same level as this time yesterday. That leaves it at 70.9 US¢, and on the cross rates it is at 93.7 AU¢, and it's at 64.2 euro cents. The NZ TWI-5 index is now at 74.9. However, against the UK pound, we are at a new all-time record high of 57.9 British pence. Tough Brexit consequence are certainly starting to bite there, even though on the streets, denial is still evident.
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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