Here's my summary of the key events overnight that affect New Zealand with news a US rate hike in December is now locked and loaded.
The latest US Fed review has them holding their rates unchanged today and continuing with their balance sheet 'normalisation'. But they also signaled a December rate hike is all but locked in.
Earlier, the pre-cursor ADP employment report was released showing very strong private employment gains in October, up +235,000 and the highest since April. (The gain in October 2016 was just +147,000.)
However, the closely-watched ISM PMI came in somewhat below expectations, although at 58.7 that index shows a rapid rate of expansion in American factory orders, production and backlog. The rival Markit PMI came in with a sharp improvement, and similar surveys for Canada showed little change, but the one for Mexico showed a sharp drop following their recent earthquakes.
Underpinning factory activity are vehicle sales and that was a mixed bag in October. However America's love affair with high-margin pickup trucks and SUVs remained in full bloom as larger, pricier vehicles fared better than passenger cars.
The rate of growth in global airfreight slowed marginally in September, up +9.2% from the same month a year ago, a moderating from previous month's expansions. Growth in the Asia/Pacific region was up +9.3%. Early signs are that passenger travel is still growing strongly, especially in the US.
HSBC is under investigation in Britain over its role laundering money for the powerful South African clan, the Guptas.
In Australia, their Government is reportedly ready to force banks to contribute to the 'positive' credit reporting database. Banks have been dragging their feet because this information will be used by rivals to target their best customers. However, after many years of avoiding it, they will now be forced into line with action required by July 1, 2018. Their Productivity Commission has declared the move will be a 'game changer' for customers, opening up better deals and lower rates for many.
In New York, the UST 10yr yield is lower today at 2.35%. Across the Pacific, Chinese Govt bond yields slipped even more with their 10 yr now down to 3.88% - and their 5 year is now now at 3.92%.
The price of crude oil is lower today, now just over US$54 / barrel, while the Brent benchmark is just over US$60.50.
The price of gold is up +US$6 at US$1,273 oz.
The Kiwi dollar is higher as well. We are now at just under 69 US¢. And on the cross rates we are at 89.9 AU¢, and against the euro at 59.3 euro cents. That puts the TWI-5 index just on 72.2, boosted by our very good employment numbers yesterday.
And finally we should note that the bitcoin price has risen to a new record high of US$6,600 and a +15% rise in one month.
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 ».
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8 Comments
Bloomberg chimes in: New Zealand’s Housing Boom Has Come to an End
Goldman has warned that we're most at risk of a correction in that article. I called this is the crash early in the year. External effects are going to speed things along now the the Fed and Bank of England are providing strong signals for interest rate increases.
GDP per capita incorrectly assumes that wealth is distributed equally; it is favored by capitalists who are obsessed with GDP growth, and who also know that those at the top always benefit from economic growth even though there is no guarantee that the mass majority will benefit. Read more
Fed some strange ideology?
Never be an idiot to pay over the odds for over inflated items of any sort, it only encourages the idiots., who sold you on the idea.
You will be in their debt ..forever...they however, may be deep in the mire themselves.
Never trust a Central bank that forces rates down, to pump up borrowings.
Never believe free money is your friend, when Gambling, nor that Harvey Norman, gives free interest on stock.
If you buy that, then you are hooked., by crooks.
And never rent a dung er from a man who thinks it is his god given right to fleece you in New Zealand.
Debt is one thing you should never aspire too, nor be your Governments aspirations.
Debt free is not being a Slave to the Man.
Land Banking is based on Growth...be very careful if under water, or near it.
Stocks and shares are sold on the premise, that they will always grow into outer space.
Gold is a bit rich, Cash is a lot better, you can buy gold.
Russian Roulette is not sensible, when you have a trigger happy twit in Power, because of a single spin.
Never trust a Central bank that forces rates down, to pump up borrowings.
Pretty much the only trick in the book. The question is when does it start shooting blanks. In the Anglosphere, demand for cheap money appears to be insatiable. Mind you, Greenspan has regrets.
Debt is one thing you should never aspire too, nor be your Governments aspirations.
Are you so sure about that? Sectoral balances suggests the greater the public debt, the greater the savings for h'holds. Post-Keynesians would not agree with you.
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