Here's our summary of key events overnight that affect New Zealand, with news ahead of the long holiday weekend that suggests there may be 'green shoots' developing in the Chinese economy.
But first, the closely-watched Federal Reserve Beige Book brought little new information this month. It reported that US economic activity continued to grow slowly, but some sectors expected growth to pick up in the coming months. It reported a “slight-to-moderate pace” of growth in recent weeks, while their labour markets remain 'tight'.
Also falling was the February American trade balance which came in just over -US$49 bln for the month for both goods and services. The goods deficit with China fell to just over -US$30 bln.
Going the other way however, US wholesale inventories as a proportion of sales rose again, now at 135% of current sales and the highest level since mid 2016. Stocks of unsold goods are particularly high in the furniture, hardware and machinery sectors, all these at over twice the current sales rate.
China’s economy grew +6.4% in the first quarter of 2019 from a year earlier, beating analysts' expectations and steady from the previous quarter, helped by sharply higher factory production. Retail sales also rose more than expected. These all come on top of a booming Chinese equities market and rising house prices.
In Europe, Switzerland will become the latest country to sign up to China's Belt & Road trade initiative. China has been very successful recently in driving a wedge between Europe and the US.
In Indonesia, the incumbent Preident is set to win a second term as the country's leader, with unofficial preliminary results from yesterday's election projecting a victory over his conservative rival. That rival looks like he will contest the result however.
In Australia, high-ranked Monash University has signed a deal worth AU$100 mln over 10 years for Chinese investors and Chinese local governments to commercialise research and development coming out of the university's Melbourne campus.
And expectations about economic growth in Australia have improved although they are still negative. The latest Westpac Melbourne Institute report says to expect below trend growth in the 'lucky country' over the next six months.
The UST 10yr yield is unchanged at 2.59%. Their 2-10 curve is little-changed however at +19 bps and their negative 1-5 curve is still at -6 bps. The Aussie Govt 10yr is up +2 bps at 1.97%, the China Govt 10yr is still rising, up +3 bps at 3.43% (and an impressive +35 bps rise since the start of the month), while the NZ Govt 10 yr is at 2.01% and down -4 bps.
Gold is still down today at US$1,274/oz, down -US$1. It is now at its lowest price in 2019.
US oil prices are a little softer today at just on US$63.50/bbl while the Brent benchmark is still at US$71.50/bbl.
The Kiwi dollar will start today -½c lower after yesterday's CPI undershoot at 67.2 USc. On the cross rates we are down as well at 93.7 AUc. Against the euro we are lower at 59.5 euro cents. That puts the TWI-5 at 71.7.
Bitcoin is at US$5,221 and little-changed overnight. 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 ».