Here's our wrap of what's happened overnight, with breaking news this morning that Jacinda Ardern has arrived at Auckland Hospital to have her baby. Winston Peters is now Acting Prime Minister. Ardern is expected to resume her role in six weeks' time.
Markets have stabilised following a late rally in Asia and lack of new market sensitive data. ANZ economists maintain the US Commerce Secretary saying Trump’s aim is free trade, not trade war, has brought about some calm. However, China remains concerned and has said it would take strong countermeasures against US tariffs.
President Donald Trump has committed to signing an executive order to end the separation of immigrant families at the US-Mexico border. However the move doesn't end the US's “zero tolerance” policy that sees illegal immigrants prosecuted. Trump's turnaround follows widespread pressure, including from heads of state in Canada, Britain, Iran, but not New Zealand.
Federal Reserve chair, Jerome Powell, has made some strong comments on how the US could be a victim of its own policies. Speaking at a gathering of central banks, he said, "Changes in trade policy could cause us to have to question the outlook. For the first time we are heaing [from business leaders] about decisions to postpone investment, postpone hiring, postpone making decisions."
Meanwhile European Central Bank chief Mario Draghi said there was "no ground to be optimistic", and the effects of trade wars on monetary policy were yet to be seen.
Existing home sales in the US fell for the second month in a row in May. Sales were 3% lower than what the were in May 2017; with sales falling on this year-on-year basis for the third month in a row. The median house price hit an all-time high of US$264,800 - an increase of 5% from May 2017. While the number of houses available for sale increased in May, this figure was still 6% lower than a year ago.
The UST 10yr yield has risen by 3bps overnight to 2.92%.
Gold is down a few dollars to US$1,272/oz.
The price of US crude oil is up slightly to US$67/bbl, while the Brent benchmark is down a little to US$74/bbl.
The New Zealand dollar is weaker today at 68.6 USc, 93.1 AUc, and 59.2 euro cents. The TWI-5 is down 4bps to 72.2.
The price of Bitcoin has risen a bit overnight to US$6,745.
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