Here's my summary of the key events overnight that affect New Zealand, with news of a new approach to affordable housing in Australia.
Last week's initial unemployment benefit claims report was a little higher than expected, taking it off its 44 year low from the previous week. US-based employers announced 37,000 job cuts in February, down -19% from January and an impressive -40% lower than the same month a year ago.
Meanwhile, American household net worth rose US$2 tln in the December quarter, an impressive +6.3% higher than in the same quarter of the previous year. Rising real estate values and rising stock markets were behind the rises. The same report showed that the growth of household debt eased a little in the quarter, and the same was true for businesses and government.
Now, all eyes are on tomorrow's non-farm payrolls report. The latest expectation is for a strong +200,000 rise.
Across the Atlantic, the eurozone is seeing sharply higher inflation, but that has not triggered any rate response from the ECB overnight. In fact, the only thing they raised was their growth forecast for the region. Their QE is still in place, adding €80 bln to their liquidity each month and that now totals more than €2.4 tln since the start of their money-printing. There was no suggestion today that this is to be tapered soon, but today's tone was more upbeat. The euro did rise on the announcement, and their bond yields firmed.
In China, the permier's annual 'Work Report' to parliament has received much coverage, but in the detail - but not in his speech - there has been much underground talk about the re-imposition of capital controls to slow the outflow of foreign currency. Apparently the Party has a blackout on discussing the issue.
And in Australia, their government has approved a scheme where the private sector would be given access to cheap capital in return for more affordable housing. Under the plan, a Federal bond aggregator will provide a long-term funding source of up to 20 years. Their current direct government efforts are considered to be significantly under-performing for the large amount of funds allocated. They are about to try something different to grow affordable supply.
In New York, the UST 10yr yield is rising still and is now up to 2.59%. We also saw some meaningful rises in local wholesale rates yesterday with the 2-10 rate curve its steepest in three years. We may see more today.
Oil prices are down sharply again today at just under US$49 for the US benchmark, while the Brent benchmark is just under US$52 a barrel. That is more than a -US$2 drop. The weakness is due to record American crude inventories, pointing to a global glut despite OPEC-led supply cuts.
The gold price is also down by -US$2, to US$1,206/oz.
And the New Zealand dollar held at its new lower level overnight at 69 USc. On the cross rates the Kiwi dollar is at 91.9 AU¢, and against the euro is at 65.2 euro cents. The NZ TWI-5 index is down to 74.9 and that is another five month low.
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 ».