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Key April PMIs hold healthy; US home sales hold but affordability worsens; China announces 5G launch date; automated warehouses coming soon; UST 10yr at 2.98%; oil unchanged and gold down; NZ$1 = 71.5 USc; TWI-5 = 73.3

Key April PMIs hold healthy; US home sales hold but affordability worsens; China announces 5G launch date; automated warehouses coming soon; UST 10yr at 2.98%; oil unchanged and gold down; NZ$1 = 71.5 USc; TWI-5 = 73.3

Here's our summary of key events overnight that affect New Zealand, with news the UST 10yr yield is now at a seven year high.

But first, in the US the latest PMI tracking shows private sector output rising solidly, underpinned by the fastest new order growth since March 2015. Still, their index readings are not as high as in Europe where they are little changed. Other measures of global trade also confirm a positive outlook.

Market risk appetities are improving; US moves on China trade and Russia sanctions are behind the shift.

American home sales increased for a second straight month in March amid a rebound in activity in the Northeast and Midwest. But they are still -1.2% lower than for March 2017. The median price is up +5.8% to US$250,400 and inventories of houses available for sale are low. Combined with the highest mortgage interest rates in four years, affordability is being squeezed just as their spring selling season kicks off.

China has announced that it will roll out 5G mobile service commercially in 2019. This new technology delivers data at lightning fast speed wirelessly (10GB/sec), making it a challenger to UFB. It is a technology expected to change how the world connects, and China is determined to lead the process. It is complicated and expensive to set up. In New Zealand Spark is trialing it with a Chinese vendor, something that worries the intelligence community.

The World Bank is reporting that migrant remittances reached US$466 bln in 2017, a rise of +8.5% in one year. India received US$69 bln from its diaspora, or about 2.5% of its GDP. These are vital flows for many emerging countries.

In Australia, a new distribution warehouse for supermarket chain Woolworths is set to completely automate, a move that is reported to allow them to eliminate more than 800 people in Victoria alone. Their rivals will need to respond with similar systems if it is successful. (And this sort of relates to these issues.)

The UST 10yr yield keeps on rising and is now at 2.98% (+2 bps). It briefly touched 3% earlier today, its highest since July 2011. (It also got this close in 2014.) The Chinese 10yr has turned up and now at 3.60% (a catch-up gain of +6 bp) while the New Zealand equivalent is at 2.94% (up +5 bps).

Gold is at US$1,324/oz in New York, and down -US$10. A stronger greenback is hurting the yellow metal.

Oil prices are little changed but high and firm and now just under US$68.50/bbl and the Brent benchmark just under US$74.50/bbl.

The Kiwi dollar is at 71.5 USc as the US dollar firms. This is its lowest since early January. On the cross rates we are unchanged at 94 AUc and 58.6 euro cents. That puts the TWI-5 at 73.3

Bitcoin is now at US$8,888 which is also unchanged from this time yesterday..

This chart is animated here. For previous users, the animation process has been updated and works better now.

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

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