Here's our summary of key events overnight that affect New Zealand, with news gritty economic data is atop today's news.
Firstly in the US, another consumer confidence survey was released overnight indicating strong levels. This survey is widely respected but is oddly different to the other main survey. Most countries, including New Zealand, have two consumer sentiment surveys and it is unusual for them to point in different directions. But the American ones do. Their multiple business surveys point in the same direction, but these two stand out by being at odds. Maybe it is just another reflection of their bifurcated society.
Meanwhile, their key house price index came in slightly lower than expectations and growth in prices under +6% for the first time in a year. So we now have a loss of momentum for price growth to match cooling volume growth.
Mexico's GDP growth came in at +2.7% year-on-year in September, the same as for June, but it was higher than markets were expecting.
In Australia, they still haven't ratified the new TPP Agreement despite their commitments to do so and time is running out. November 1 is a key date for the trade deal to come into force at the start of 2019 and Australia's ratification is the last one needed for that to happen. But the Aussies are having trouble getting their act together. Update: Australia has now completed ratification.
The Shanghai equity markets were up +1% in trade yesterday. The 'home team' is still active. Today, Wall Street is up +0.5% in early afternoon trade
China has lifted its 25 year ban on body parts of tigers and rhinos in a very retrograde step for world wildlife.
In Singapore, the head of their sovereign wealth fund is warning that credit excesses and their property markets are the two of the big challenges facing China. He says key tasks for the country include the ongoing shift from investment to consumption, improving corporate governance, controlling pollution, and reducing poverty. Progress is uncertain on most of these, so risks are elevated.
Economic growth in the EU slipped to +1.7% in the September quarter, down from +2.2% in the June quarter. This was not helped by results from France, or Italy. The Germany result is yet to be released publicly and is not due until November 15.
Economic sentiment in the EU, the combining of their consumer and business surveys, is turning decidedly lower mainly because of dipping business sentiment.
German unemployment fell below 5% for the first time since reunification and for the first time ever they reported their workforce grew past 45 mln people. Consumer prices rose +2.5% in October, and that was higher than expected.
Italy's economy actually came to a standstill in the third quarter of the year, registering no growth at all. Confidence is leaking away in their new radical and disorganised coalition government.
The UST 10yr yield is unchanged at 3.10%. But their 2-10 curve has slipped to under +26 bps. The Aussie Govt 10yr is at 2.59% (up +1 bp), the China Govt 10yr is at 3.54% and unchanged, and the NZ Govt 10 yr is also unchanged at 2.55%.
Gold is at US$1,223/oz a dip of -US$2/oz.
US oil prices are softer again today at just over US$66/bbl. But the Brent benchmark are just over US$76/bbl. Rising supply and falling economic growth are factors pushing the price lower.
The Kiwi dollar is starting today a little firmer at 65.6 USc. On the cross rates we are at 92.3 AUc, and at 57.8 euro cents. That puts the TWI-5 up to 70.2.
Bitcoin is unchanged today at US$6,282. This rate is charted in the exchange rate set below.
This chart is animated here.
The easiest place to stay up with event risk today is by following our Economic Calendar here ».
Daily exchange rates
Select chart tabs
22 Comments
Ardern needs to stop basing economic policy on Sh*t My Dad Says. Turns out it’s true her Dad “don’t know much about the science.”
“Over the past decades, atoll islands exhibited no widespread sign of physical destabilization in the face of sea‐level rise. A reanalysis of available data, which cover 30 Pacific and Indian Ocean atolls including 709 islands, reveals that no atoll lost land area and that 88.6% of islands were either stable or increased in area, while only 11.4% contracted. Atoll islands affected by rapid sea‐level rise did not show a distinct behavior compared to islands on other atolls. Island behavior correlated with island size, and no island larger than 10 ha decreased in size.”
https://onlinelibrary.wiley.com/doi/abs/10.1002/wcc.557
Jacinda Ardern: 'Climate change is my generation's nuclear-free moment ...https://www.newshub.co.nz › jac...
A few years ago I read an article sourced from Greenpeace talking about sea level rise. I found it amusing because only the week earlier I read an article on geophysical science that identified the island that Greenpeace used as an example wasn't actually suffering global warming sea level rise, but was sinking due to tectonic plate movement. A matter of perspective I guess. If you're living on the island the sea level is appearing to rise. The cause however is another matter....!
I was interested in the article as I visited Kiribati (the atolls of Tarawa and Butaritari) a few years ago to have a look at among other things the effects of sea level rise on the atolls. Remains of the WW2 Battle of Tarawa were one of the other attractions.
I am critical of the article as the supporting data as the conclusion is based on a simplistic analysis of changes in land size of atolls.
Atolls are an extremely - arguably the most - dynamic landform which can are subject to influences of wave and wind and consequential sediment movement. An atoll can be largely destroyed by a tropical cyclone to rebuild over a period of a few years. A simple analysis of atoll area may not be a good premise as the atolls may be likely adjusting and responding to rises in sea level.
I saw a range of evidence consistent with sea level rises; areas of South Tarawa where mature dead coconut trees were killed by salt water inundation and surrounding well established houses abandoned as they were inundated by high tides, I talked with some long established locals in an other area who were fighting a losing battle to the sea progressively removing their houses further back from the sea despite building sea walls, and on Butaritari there was a school where the fresh water lens had been polluted by sea level rise, former cultivated gardens areas which were now subject to tidal flooding, and along a continuous 7km length of the coast where erosion had undermined well established trees and roots.
Was all of this due to sea level rising? There was some likely evidence that building causeways linking the sand keys is likely to have had an effect but to me, however, a critical analysis of the evidence indicated to me that there was a range of physical evidence of likely sea level rise.
Not all research is free of flaws; I would put this research in the possibly flawed category. I would be looking also at the wide range of research including NASA measurements in changes in sea level rather than hanging out on one piece of possibly flawed research.
Hi HK
My point was that I had witnessed effects of sea level change on atolls which include some of the atolls in the report data.
The deductions being read into this report that there is no sea level rise - as is being done in the above comments - are very much flawed and goes against the vast weight of reputable scientific evidence that conclusively show a rise in sea level. I refer you to NASA information (Google it!!) that not only show rises in sea level, but have been increasing more rapidly over the past 100 years. Melting ice caps - and even retreat of all New Zealand glaciers in North and South Island - counter any argument that there can be no rise in sea level. Note that sea levels have been rising for the past 20,000 years since the last ice age.
I noted in the article that atolls are dynamic and are able to respond to change - this does not necessarily mean that there is no change in sea level which is being inferred in the above responses. If one looks at the supporting data, you will note that many atolls have indeed had reduction in area; I suggest that those which not reducing in area are responding to ongoing sea level changes as they have done for rising sea levels since the last ice age 20,000 years ago.
Although some atolls are obviously responding to the rise in sea level - the vegetation, plants and people are being affected as I highlighted.
It is interesting that Kiribati's long term strategic plan is for no country and they have purchased land in Fiji once they become sea rise level refugees.
Sea level has risen 120m in the last 20000 years. And has oscillated by about 2-3 m at rates of change up to 10mm/yr during the length of the Holocene (roughly last 10000 years). Given that isn't it just remarkable that thousand of atolls all over the world just happen to be a few metres higher than the current sea level? Do I need to include a /sarc tag?
There are obviously very stable land accretion processes (coral and mollusc shell growth and transport onto land) that keep atolls relatively stable in extent.
China's move to lift a ban on animal body parts is a disappointment. Stuff ran a story the other day; We're wiping out life on Earth, WWF warns which essentially identifies that our (human) impact on animal life is nothing short of utterly devastating. I would suggest beyond the worst of human genocides. This bodes extremely ill for the human race.
The solution will be next to impossible as we are too tied up culturally in killing things. We have become too skilled at justifying it. From a religious perspective the Commandment "thou shall not kill" (christian, Islam has a somewhat different version) has been taken to mean other humans, but this situation requires that it mean all living animals. When a single krill trawler can extract 1000 tons of krill a day from the southern oceans, it is no surprise our food supply is collapsing, and sharks now patrol our swimming beaches looking for lunch!
Ironically we might stop global warming because most acknowledge it is happening and are working on stopping it, but we will still destroy ourselves because we are also destroying other parts of our environment that are just as important!
..."most acknowledge it is happening and are working on stopping it..."
Dont think so.Seriously - hands up who voted for someone promising economic growth?
Its the environment OR the economy. We dont actually have a choice on that. We need MORE debt claims to hold Debt & supply chains together ... but those debt claims come with a caveat that INCREASES future resource use.
And no one is voting for economic collapse (ie collapse of living standards, supply chains and mass starvation..). Overshoot is a bitch.
I saw a documentary the other day where conservation workers were tranquilising rhinos and taking the horns off to stop them being killed by poachers. Apparently the rhino horn has no nerve supply, so knocking them out is only necessary because of their size. They were lamenting that they didn't have the funds to do all the rhinos.
Considering that the horn grows back and that the rhino isn't harmed by the procedure, and that there is demand for the product, why not farm them for their horns? No different to deer velvet, and a lot better than having the wild population wiped out by poachers.
Xingmowang will be here in no time at all to remind us that China selects all its politicians through a rigorous meritocracy, where only the most intelligent, competent, and skilled at Kung Fu ever manage to make it to the highest ranks of the Red Bandit Communist Party.
Yep. Ecological suicide. The human race is mentally(spiritually) unwell.
Earth is a living, breathing organism and every life form represents organs, cells, tissues, etc. Destroy individual parts and we destroy the whole.
Our homes are worth millions though and everyone can be rich so yeah, non issue.
Are we reading he same article?
"All illegal trade in rhinos, tigers and their related products will be subject to severe crackdowns, and the approved activities will receive close monitoring..and. Sales of products with ingredients containing rhinos, tigers and their related products also will be classified as illegal".
Yes, we are reading the same report. This is the official sanitised version newly authorising importing for Chinese Traditional Medcine use (was banned), all couched in misdirecting language. This is a backward step a bit like the Japanese whaling regulations "for research". Not every Chinese official release is what it first appears to be. (Not only a Chinese problem.)
Others have reported what the likely effects will be.
Europe More Than Europe: From ‘Boom’ To The Precipice of Recession
https://www.alhambrapartners.com/2018/10/30/europe-more-than-europe-fro…
Jeffery Snider on bloomberg
https://www.alhambrapartners.com/2018/10/30/bloomberg-interview-with-je…
Angela Merkel announces she will not stand for re-election in 2021. Maybe the most-likely contender for her position could bring back some sanity in German politics.
https://global.handelsblatt.com/politics/friedrich-merz-merkel-quest-cd…
According to the Federal Labor Office, the educational level of newly arrived migrants in Germany is far lower than initially expected: only a quarter have a high school diploma, while three quarters have no vocational training at all. Only 4% of new arrivals to Germany are highly qualified.
Jeez, is this the legacy Merkel will be leaving behind?
Dead cat bounce or bottom of the slide?
Markets in Asia, Europe and US consistently up; Dow Jones now currently up by 1.77% and Nasdaq by 1.55%. However, we have seen similar daily rises over past three weeks including Shanghai which has been on a long term slide into bear territory.
We welcome your comments below. If you are not already registered, please register to comment.
Remember we welcome robust, respectful and insightful debate. We don't welcome abusive or defamatory comments and will de-register those repeatedly making such comments. Our current comment policy is here.