Here's our summary of key events overnight that affect New Zealand, with news of a rout in cryptocurrency markets.
Firstly in the US however, industrial production rose sharply in December, boosted by gains in utilities output as cold weather swept across the country and increased the demand for heating. It was up +3.6% since December 2016, its largest calendar-year gain since 2010. But their factory sector was little changed from November, although year-on-year it is up +2.4%.
US corporate earnings are coming in strong for the December quarter and Wall Street is up, with the Dow again above 26,000 and almost +1% on the day. (Yesterday was a good day on the NZX with its NZX50 up +0.6% but not so good on the ASX with the ASX200 down -0.5%.)
The Bank of Canada has raised its policy interest rate by +25 bps to 1.25% on the strength of strong employment data and a rise in inflation. However, it said it will be cautious from here, warning that uncertainty tied to the future of the NAFTA is likely to exert a drag on growth. It downgraded its 2018 growth forecast to +2.1% from +3.1% in 2017. It has credibility as a forecaster.
In France, family-owned dairy company Lactalis is widening a product recall to cover all baby milk manufactured by a factory at the center of a salmonella contamination. That involves sales to 83 countries and more than 12 mln cans. And today, police raided both the closed factory and the firm's headquarters.
In Australia there are increasing fears of the consequences of moving tens of thousands of interest-only housing loans on to principal-and-interest basis. There is more than AU$60 bln involved and depending on when they were taken out some conversions could see repayment levels rise by +50%. The flow-on impacts on general consumer spending are starting to be understood.
And staying in Australia, major insurers Allianz and Suncorp have been caught in a bald car insurance scam. Together they will refund a combined AU$65 mln in premiums to more than 100,000 customers, after selling insurance via car dealers "that was of little or no use", according to ASIC. Allianz will refund AU$45.6 mln to 68,000 customers and Suncorp will refund $17.2 mln to 41,200 customers. There is growing anger over the situation.
The UST 10yr yield is unchanged at 2.56% today. The equivalent 10yr China sovereign bond is up +1 bp at 4.03%. The equivalent NZ 10yr sovereign bond is down -1 bp at 2.89%. But there was a sharp fall in the premium investors need for NZ Govt credit default swaps and that is now just +13.5 bps and a record low.
Oil prices are little changed today with the US benchmark now just under US$64 a barrel, while the Brent benchmark is now over US$69.
Gold is also little changed, up +US$2 to US$1,336/oz.
The Kiwi dollar is rising this morning and is now at 73.2 USc. On the cross rates it is at 91.4 AUc, and against the euro at 59.6 euro cents. That puts the TWI-5 at 74.4 and little changed from this time yesterday.
The really big movements are in the cryptocurrency markets. Bitcoin has fallen sharply again over the past 24 hours crashing below US$10,000 and at one point reaching US$9,200. It has since bounced back up to be just back under US$10,000 which is a -$US1,200 net drop in 24 hours. Intensifying regulatory fears seem to be behind the plunge.
The easiest place to stay up with event risk today is by following our Economic Calendar here ».