China ups restrictions on capital outflows; National commits to spending more on roads, Labour dips into Greens territory; Fed official stands up for immigration; UST 10yr yield at 2.20%; oil up, gold stable; NZ$1 = 73.2 US¢, TWI-5 = 75.7

Here's my summary of the key events from over the weekend that affect New Zealand, with news of another official speaking out against US President Donald Trump.

Dallas Federal Reserve President Robert Kaplan has come out saying the US’s historic openness to immigrants has given it the competitive edge it needs to compete with China. He notes immigration is what differentiates the US from China and Japan, and says, “Let’s make sure we’re very careful about undermining those things that made us great.”

Kaplan made these comments as Steve Bannon, was ousted from his role as Trump's chief strategist. Bannon had spearheaded the US Administration’s campaign for economic nationalism.

China has taken another step to restrict capital outflows. It has released a guideline restricting Chinese investment in overseas “real estate, hotels, entertainment, sport clubs, outdated industries and projects in countries with no diplomatic relations with China, chaotic regions and nations that should be limited by bilateral and multilateral treaties concluded by China”.

The guideline also prohibits “domestic enterprises being involved in overseas investment that may jeopardize China’s national interests and security, including output of unauthorized core military technology and products, gambling, pornography and other prohibited technology and products”.

New data shows US consumer sentiment improved to its strongest level in seven months in early August. The University of Michigan's consumer sentiment index rose more than expected in the first half of August. However the university’s chief economist questions whether this optimism will hold in weeks ahead, following the white nationalist rallies in Charlottesville.

Back in New Zealand, electioneering is in full swing. Over the weekend the Government announced plans to spend $10.5 billion on 10 routes that will form the next generation of Roads of National Significance. Meanwhile Labour Leader Jacinda Ardern made a rousing speech at the party’s campaign launch, saying climate change is her generation’s “nuclear free moment”. Labour will announce its plans to invest in transport infrastructure in the regions today.

The number of active oil drilling rigs in the US fell by five last week to 763, according to Baker Hughes. However this time last year there were only 406 rigs in action. The jump shows US oil producers are planning to hike output over the next couple of years. However Reuters reports oil companies had mapped out ambitious spending plans, expecting prices to be higher than what they are at the moment.

The benchmark crude price is at US$48.50 a barrel, while the Brent benchmark is at US$52.70.

The gold price is stable at US$1,286/oz.

In New York, the UST 10yr yield has continued to fall since Friday to 2.20%.

The New Zealand dollar is stronger at 73.2 USc, 92.2 AU¢, and 62.2 euro cents. The TWI-5 index has inched up to 75.7.

If you want to catch up with Friday's news, we have an update here.

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