Here's our summary of key events overnight that affect New Zealand, with news of more evidence world trade is on the slide.
The volume of international airfreight slumped -4.9% in February from the same month in 2018 and is the lowest February in three years. The Asia-Pacific region has been particularly hard hit with volumes down more than -11%. This backtrack in trade mirrors the new export orders component of global factory PMIs. This airfreight data is broadly matched by a low Baltic Dry index for ocean shipping.
The decline we see in airfreight trade is not happening for passenger travel however. This is still growing although the rate of growth is moderating. In the year to February, it is up +4.6% which is slightly below its long-run growth level. In the Asia-Pacific region, the growth is a little softer at +4.2% pa. As an aside, the same data shows the domestic Australian air travel data declining at a faster rate than previously. It has been weak for a while now.
In the US, the number of Americans filing applications for jobless benefits fell to a nearly half-century low last week, pointing to sustained labour market strength despite slowing economic momentum. All eyes are now on tomorrow's non-farm payrolls report. The question will be how strong the bounce back from February's unusually low level will be. Analysts are picking a very modest +180,000 gain.
In Korea, they have launched the world's first 5G network and signed up the first subscribers. They have beaten the US to the punch who launched in selected markets a few hours later, followed probably by China who is some way off yet. 5G allows a massive improvement in mobile (wireless) connectivity, allowing IoT capability to be cheap and easy. It will likely challenge wired UFB for speed.
In India, their central bank cut its policy interest rate by -25 bps overnight to 6.0%. Although not unanimous, it was a widely expected move to boost the Indian economy and comes just a week ahead of when national election voting begins. India's government cleared out the central bank's independent governor last year replacing it with one more sympathetic to the policies of the government. Analysts expect another rate cut relatively soon as India's economic growth is slowing, down to 'just' +6.6% in December, its lowest in more than a year. Although inflation remains restrained, falling farm incomes and record high unemployment are seen hampering the government's re-election prospects.
In Germany, factory orders fell sharply in February. And the rate of decline - -4.2% pa - was twice that reported in January and the January data caused real concern. Today's data will heighten that.
In Australia, their energy market operator is being forced to intervene daily in their electricity grid as an influx of renewable energy and ageing coal-fired power stations make their distribution systems unstable.
And the price of iron ore, Australia’s biggest export (although coal claimed this title recently), has surged more than +10% in five days, boosting miners and the Aussie tax take.
The UST 10yr yield is little-changed this morning to 2.51%. Their 2-10 curve is at +17 bps and their negative 1-5 curve is at -10 bps. The Aussie Govt 10yr is also little-changed at 1.90%, the China Govt 10yr is higher, up another +3 bps to 3.27%, while the NZ Govt 10 yr is also up, now at 2.03%, up another +9 bps since this time yesterday. Yesterday local swap rates firmed again, especially at the long end.
Gold is down -US$2 at US$1,289/oz.
US oil prices are slightly firmer today at just under US$63/bbl while the Brent benchmark is now at US$70/bbl.
The Kiwi dollar is a little softer this morning and now at 67.6 USc. On the cross rates we are also marginally lower at 95 AUc. Against the euro we are down slightly at 60.2 euro cents. That puts the TWI-5 at 72.3.
Bitcoin has slipped back under US$5,00 this morning and is now at US$4,944, up another +8% in the past 24 hour. 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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12 Comments
No. Fibre will keep getting faster too. Upgrade the boxes at either end of the fibre, and up goes the speed.
Southern cross fibre, the main communications connection from NZ to the world has gone from 80Gb/s in 2000, and after the next round of upgrades is going to be at 7400Gb/s.. all on the same physical fibres, just upgrade the electronics/lasers along the way.
Don't buy into the 5G marketing spin David.
The frequencies that 5G uses are very easily blocked, trees, humans, walls etc. hence you will very rarely get 5G speeds unless you have uninterrupted line of sight to a transmitter. As a result there will be many more admittedly smaller transmitters all over the place.
Using your mobile phone you will likely see your phone switch between 5G and 4G constantly as you move around. This will likely have an impact on battery life too.
However from an Internet-of-Things perspective - 5G will have very little impact - it is highly unlikely that all those little devices all over the place will have line of sight to a 5G transmitter.
Yes, if you're stood with LoS to a 5G transmitter (and that transmitter isn't overloaded with other connections) you'll get faster speeds - if not, you'll mostly be on 4G. But with a far more expensive 5G handset ;).
Radiation concerns halt Brussels 5G development, for nowhttp://www.brusselstimes.com/brussels/14753/radiation-concerns-halt-bru…
Very sensible.
Submitted on this point to MBIE's Radio Spectrum Management team some time back when they were asking for feedback - there's no doubt that 5G tranmits both more often, at a higher frequency (millimeter waves) and in higher 'bursts' so the emitted radiation is higher.
Of course the industry doesn't make any money from NOT deploying a new technology, and will point to the fact that there isn't research to support that millimeter radiation is harmful. Of course there's not research to say it isn't either, but that won't stop 'progress'.
Plenty of ammunition out on the web so you can make your own mind up - all I would say is don't just buy into the hype - become informed.
For those who wish to take on a little debt, or reduce it.
Goldman Sachs sees RBNZ cutting in May , previously a hike in November
Kiwibank ,thrown in the towel,all in on cuts May/August
ANZ , who have been the front runners, cuts August/November/February, but see possibility of May start
BNZ, two cuts
ASB, have had a change of mind, two cuts May/ August
HSBC, who cares as long as you take a market leading mortgage
Westpac, the outlier, previously a rate hike November , now no change thru 2021
Dart throwing chipmunk, its all nuts. As is
Roger Kerr, everyone who does not agree with Roger is a DGM., read about it on a Monday.
Westpac see the RBA cutting twice this year, The contrarian ,possibly stuck in an awkward position, as the NZD finally gives some ground to its cousin.
I am left dumbfounded as to how Asian economies report such stellar growth rates .......... 6,6% in India for example, and unbelievable numbers that come out of China .
Is inflation factored into the calcs , and the slow depreciation of the Indian Rupee for example
Maybe I am being over-simplistic , but If one compounds these growth rates , the compounded effect of the reported growth rates imply that the economy doubles every dozen years or so .
And thats what I cant get my head around
You should travel there Boatman..smart educated huge population eager to get ahead. When I attended 2 University degrees was the nom..1 was sneered at, some very smart young people there and a huge work ethic. However, the problem remains that they do tend to say yes to everything even when the answer is no.
Jo Nova has a typically good take on the Oz grid crash-test-dummy experiment now unfolding. Essentially, PV and wind have large, unacknowledged negative externalities, such as the need to implement expensive corrective equipment for frequency stabilisation, power factor control, and monitoring in general.
None of this is borne by the renewables, which are (but of course) heavily subsidised into being there. Baseload/dispatchable capacity and spinning reserve is of course all coal- or gas- fired. Baseload, at something like 18 gigawatts, is far beyond even the installed capacity of the renewables at 8-9 gigawatts, and as the latter's capacity factor is south of 30%, more like 3 gigawatts (only at midday, and whenever Gaia feels like breathing out).
Lance's comments on the thread (he's a real power engineer...) are priceless.
Have you guys ever done the speed tests on your mobile using the Apps like Okla ? 4G is plenty fast enough the problem is not enough towers to give you the signal strength to get the speed, its the same with your Wi-Fi, the closer you are the modem the better the speed and quality of the connection. 5G is even worse and it really only good for very high density urban living and you need to be looking at the transmitter on a line of sight, this simply is not going to work with our Urban sprawl. Fibre is the way to go if you can get it but wireless 4G is very convenient out in the rural areas on the 700MHz band 28.Vodafone need to put VOICE on 4G at present its only DATA. The 4G network is not optimized, we don't need 5G.
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