Dairy prices disappoint; fewer US consumers expect to be better off; China current account surplus dives, WTO warns on trade slowdown; UST 10yr 2.66%; oil stable and gold jumps; NZ$1 = 68.9 USc; TWI-5 = 73.3

Dairy prices disappoint; fewer US consumers expect to be better off; China current account surplus dives, WTO warns on trade slowdown; UST 10yr 2.66%; oil stable and gold jumps; NZ$1 = 68.9 USc; TWI-5 = 73.3

Here's our summary of key events overnight that affect New Zealand, with news of more evidence of a worldwide trade slowdown.

But first, today's dairy auction brought overall prices only marginally firmer, with a +0.9% gain in US dollars. The key WMP price was virtually unchanged. This will be something of a disappointment after the futures market signaled another good rise. Even more of a disappointment is that the result in New Zealand dollars is actually a decline because the Kiwi dollar has strengthened in the past two weeks. So in local currency we have recorded a -0.4% slip. Still, prices are still up +20% since early December. However, farm gate milk price indications are unlikely to get updated based on today's auction.

In the US, a national survey run by the NY Fed reveals American consumers expect to spend +2.8% more money in 2019 than they did a year ago (+2.3%). The same survey reports the share of households expecting to be better off a year from now fell to 38.6%, the lowest level since November 2016.

In China, they reported their 2018 current account surplus down -70% year-on-year to a record low of US$49 bln. But that was actually better than expected. In the March quarter of 2018 they recorded a current account deficit of -US$29 bln followed by two subsequent tiny surpluses. The fourth quarter result was stronger than expected, bolstered by strong exports.

And China is going backwards in its fight against air pollution. And that is the official news. Air pollution levels were up more than +8% in January compared to the same level a year ago in a national survey of more than 300 Chinese cities.

In Europe, 'Brexodus' is gathering pace with two large UK financial firms gaining official approval to move significant operations out of London, following US and EU banks.

Through all this, Germany’s 2018 current-account surplus was the world’s largest for the third year in a row.

Internationally, the WTO is warning a global trade slowdown is underway as one of their key indicators has hit a nine-year low.

The UST 10yr yield has dipped -2 bps to 2.64%. And their 2-10 curve has also slipped to +14 bps. The Aussie Govt 10yr is down -2 bp at 2.12%, the China Govt 10yr is up +1 bp at 3.13%, while the NZ Govt 10 yr is up +2 bps at 2.26%.

Gold is up sharply today by +US$14 to US$1,339/oz.

US oil prices are unchanged at just on US$56/bbl while the Brent benchmark is holding just over US$66/bbl.

The Kiwi dollar is up at 68.9 USc. On the cross rates we are also holding high at 96.1 AUc, and firmer at 60.7 euro cents. That puts the TWI-5 at 73.3.

Bitcoin is also higher at US$3,932 which is a +1.9% gain on the day. This rate is charted in the exchange rate set below.

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

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Source: CoinDesk

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11 Comments

Comment Filter

Highlight new comments in the last hr(s).

CBS News chief foreign affairs correspondent Lara Logan has broken ranks and admitted that journalists have lost their objectivity and become "political activists."
https://www.zerohedge.com/news/2019-02-19/cbs-news-chief-policital-corre...

These Charts Show The Political Bias Of Workers In Each Profession

https://www.businessinsider.com.au/charts-show-the-political-bias-of-eac...

Some interesting stats.
Lara Logan hits the nail on the head.

Europe prepares risky counter-attack in US car war as Atlantic alliance falls apart
https://www.telegraph.co.uk/business/2019/02/19/europe-prepares-risky-co...

Metaphorically - Field Marshall Junker & Master of the Universe launches his 4 man rowing boat complete with its double barreled peashooter as the USS Nimitz sails into Brest and his man of war overturns in the wake of Nimitz leaving Junker/Tusk/Verhofstadt/Barnier very wet.

29 auctions today at Barfoots Shortland St.. results will be telling.

Can a reader head down there and report back in realtime?

Sure you can. Get to it.

I will go.... You do the fencing!

I would but the slave masters are making work hard today!

Out in front leading the way are the unfortunate Chinese. Germany may stake a claim to certain high degrees of negativity, but in the manner of unusually bad indications right now China is winning (meaning losing). In yet another ominous sign, auto sales tanked again in January.

Down more than 17% year-over-year last month, unit sales are plunging in a way unfamiliar to modern China. This is pre-market reform stuff, the kind of setback that suggests something very unusual is going on.
https://www.alhambrapartners.com/2019/02/19/something-different-about-th...