NYFed sees own goal; Wall Street lower; Canada prices higher; EU sentiment holds up near record; huge EU VAT fraud; India hit on RBI minutes; UST 10yr 2.96%; oil unchanged gold down; NZ$1 = 72 USc; TWI-5 = 73.6

Here's our summary of key events overnight that affect New Zealand, with news China's Belt & Road network is also an enabler of Chinese organsied crime activity.

But first in the US, new research by the NY Federal Reserve points out that their proposed steel tariffs will be an own-goal. They will cost the American economy jobs; “Although it is difficult to say exactly how many jobs will be affected, given the history of protecting industries with import tariffs, we can conclude that the 25% steel tariff is likely to cost more jobs than it saves," they say.

Wall Street has closed down with most benchmark indexes shedding almost -1%. Tech stocks fared worst.

In Canada, their consumer prices rose +2.3% on a year-on-year basis in March, following a +2.2% increase in February. This was the largest such increase since October 2014. But excluding petrol, their CPI rose +1.8%, matching the gain in February.

The EU's latest survey of consumer sentiment moved slightly higher for April, holding the elevated levels seen in 2018, the highest since the survey began in 2005.

In the depths of their crisis, Greece sold its main port at Piraeus to a Chinese state-owned shipping company COSCO. It brought a lifeline of cash when they were desperate. It was also one of the earliest of China's Belt & Road investments. It is working out for both parties, but perhaps in some unexpected ways. EU authorities now see it as an entry hub for Chinese organised crime where they defraud EU nations of VAT. And in the US, COSCO is seeking approval to buy a major new port facility in the Port of Long Beach. American authorities are wary. These issues come after concerns are heightened over the debt countries take on to be part of China's B&R network.

In India, markets reacted aggressively with bonds being hit hard as unexpectedly hawkish central bank minutes were released. They add to higher oil price pressures that higher official interest rates are just around the corner. The rupee fell to its weakest in more than a year.

The US may be excluded, but Australia thinks the UK is showing "real interest" in joining the TPP.

The UST 10yr yield is now at 2.96% and up +4 bps overnight. The Chinese 10yr stopped falling and is at 3.54% (up +2 bps) while the New Zealand equivalent is at 2.88% (unchanged).

The VIX is just marginally lower than this time last week and the index is now just over 17 and still elevated. The average index level over the past year is 12. The Fear & Greed index is at "fear" levels and has pulled back from its crisis level of a week ago. Interestingly, it is now slightly lower that level it was a year ago, so the 'fear' conditions have eased a lot in the past week.

Gold markets have not yet closed but at this time the price is at US$1,335/oz in New York. That is down -US$10 since this time yesterday.

Base metals have had an extraordinary spurt after the US imposed sanctions against Russian companies, prompting fears of a supply squeeze. Aluminium rose more than +5% overnight and is now up more than +23% over the month. Nickel jumped more than +7% last night, while zinc (+3%) and copper (+2%) were also bid up. These are big moves in these markets.

Oil prices however are unchanged overnight at just over US$68 and the Brent benchmark just over US$73.50/bbl. The North American rig count moved even higher this week. And the US President sharply criticised OPEC, blaming them for the higher recent prices. It has had no impact on them however, leaving oil at three year highs.

The Kiwi dollar is ending the week up at 72 USc and that is now a substantial retreat over the week; it was 73.6 at this time last week, so a fall of -1½c. On the cross rates we are at 94 AUc and 58.6 euro cents. That puts the TWI-5 at 73.6 and -100 bps below last weeks closing level.

Bitcoin is however at US$8,532 and that is a net gain of +5.5% in the week.

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