US growth based on consumer spending; PCE, confidence and house prices up; India growth surprises, China birthrate focus, AU RE agents face disruption from within; UST 10yr yield at 2.35%; oil and gold lower; NZ$1 = 72.3 US¢, TWI-5 = 77.6

Here's my summary of the key events overnight that affect New Zealand, with news markets are waiting for details of the US federal budget plans.

But first, American economic growth slowed in Q4-2016 to +1.9% pa with strong consumer spending offset by downward revisions to business and government investment. Personal consumption expenditure, the US Fed's preferred measure of inflation, rose to +1.6% for the same period, and the highest rate since Q3-2014.

That improved consumer confidence is supported today by the Conference Board's consumer sentiment survey, which rose to a 15 year high, and the Case-Shiller home price index, which reported its fastest full year growth since 2013.

But the gloss may come off this optimism as we are about to get data on US car sales, which are expected to be flat despite recent heavy discounting. Unrealistic growth assumptions by the new American administration may get markets backpedaling too

There were also growth figures out overnight for India which were a bit of a surprise. Growth there slowed in the December quarter, but the pace of expansion still beat expectations. The 7% rate was slower than the previous quarter's rate of 7.4%, but analysts' expectations were for just 6.4% because of the turmoil involved in their government's decision to withdraw high-denomination banknotes as part of its anti-corruption drive.

In China, they are getting practical about encouraging families to have more children. In 2016, an additional +1.3 mln more babies were born in the country than in 2015, but for their sustainable demography, it was not enough. Affordability has been identified as a key constraint, so subsidies and transfer payments are on the table. One thing for certain is that infant formula, and dairy products will be in increasing demand.

In Australia, RJ Hooker, one of their real estate heavyweights is launching a discount brand, Settl. It is a move that will no doubt unsettle its vast ranks of commissioned agents. Low cost agency distruptors are starting to gain traction across the ditch, and it is just a matter of time before it happens here.

In New York, the UST 10yr yield is basically unchanged at 2.35% ahead of the 2017-18 budget launch.

Oil prices are down today and now just over US$53 for the US benchmark, while the Brent benchmark is just over US$53 a barrel. Interestingly, the US is now exporting 1.2 mln barrels per day, and that is not something OPEC was counting on.

The gold price is also a little lower at US$1,256/oz.

And the New Zealand dollar starts today up slightly at 72.3 USc. On the cross rates we are at 94.1 AU¢, and against the euro at 68.1 euro cents. The NZ TWI-5 index is still in its three-week tight range at 77.6.

If you want to catch up with all the changes yesterday, we have an update here.

The easiest place to stay up with event risk today is by following our Economic Calendar here ».