Here's my summary of the key events overnight.
Sky-high property prices are spurring “widespread” mortgage fraud in China. Reuters reports that unqualified borrowers are using fake documents to secure mortgages, while loans obtained for other purposes are being funnelled into property. The frauds often require buy-in from brokers, valuers and banks. The concern is that the situation leaves banks dangerously exposed. In its report, Reuters quotes a lawyer who says: “When everyone is doing it, you can’t put everyone in jail.”
Interest.co.nz has heard of similar rings operating in New Zealand - particularly a few years ago before banks tightened their lending. In fact, two property developers, a banker and lawyer accused of committing at least $50 million of mortgage fraud are due to go on trial in February.
Staying in New Zealand, the Government has announced it will “urgently” establish a new advisory group to look into improving the health system. The announcement follows the Director-General of Health, Chai Chuah, yesterday resigning, and the Waikato District Health Board chair, Bob Simcock, last week resigning in the wake of a scandal over spending.
The value of bitcoin is being touted as exceeding the value of New Zealand’s entire economy in a Bloomberg report. With US$190 billion of bitcoin said to be in circulation at the moment, its market capitalisation is around US$5 billion more than New Zealand’s GDP. Bitcoin is also said to be bigger than Boeing and Warren Buffet.
Data shows new orders for US-made goods fell less than expected in October. Factory goods orders dipped 0.1% amid a drop in demand for civilian and defence aircrafts. Meanwhile shipments of core capital goods, which are used to calculate business equipment spending, advanced 1.1% in October instead of the previously reported 0.4% rise.
Progress made on US tax reform has given equities and yields, as well as the US dollar, a boost.
The UST 10yr yield has risen overnight to 2.39%.
The price of crude oil is down to just under US$58 a barrel, while the Brent benchmark is just under US$63.
The price of gold has fallen to US$1,274 an oz.
The New Zealand dollar is weaker at 68.5 US¢, 90.1 AU¢, and 57.8 euro cents. The TWI-5 has dropped to 71.3.
If you want to catch up with yesterday's changes, we have an update here.
The easiest place to stay up with event risk today is by following our Economic Calendar here ».