Here's our summary of key economic events overnight that affect New Zealand with news of a sense the global economic expansion may be slowing.
Firstly in the US, the University of Michigan's consumer sentiment for the US fell to an index of 66.8 in November of 2021 from 71.7 in October and well below market expectations of 72.4. It was the lowest reading since November 2011 due to an escalating inflation rate and the growing belief among consumers that no effective policies have yet been developed to reduce the damage from surging inflation. In this survey, inflation expectations for the year-ahead edged up to 4.9% from 4.8% - higher, but actually lower than the actual inflation currently hitting the US at 6.2%.
US job openings slipped to 10.4 mln in September but well ahead of what was expected. And August's data was revised up. The 'quit' rate rose and more people (4.4 mln) resigned their positions voluntarily to move to another role than at any other time since this series started 20 years ago.
The number of ships waiting at US West Coast ports for unloading has grown to 111, 78 of them in Los Angeles. But there are signs the situation may ease as new fines for waiting for more than 5 days by importers to pick up their goods is motivating them to clear incoming cargoes which is now holding up ship unloading.
In Canada, the central bank's senior bank officer loan survey reports the easiest conditions for credit approvals in the series history for non-mortgage lending to households, and series equal-easiest condition for mortgage lending.
In China, a new equity market is opening in Beijing, to join the Shanghai, Shenzhen and Hong Kong markets.
And this year’s “Double 11” online shopping event saw sales grow at a slower pace amid regulatory tightening and as China’s overall consumption slows down. But it still hit a new record high of NZ$70 bln on the day (11/11/21), up +8.5% from last year. Almost 1.2 bln packages were sold at an average price of NZ$60. (However most platforms had much larger sales than this because they ran this promotion starting on November 1 through November 11. Over this longer period the two largest platforms sold NZ$200 bln of product. Apple alone sold about $2.5 bln in this 11/11 promotion. Fresh food including dairy products were reported as selling well too.)
Excavator sales in China plunged -30% in October from the same period last year, their biggest monthly drop this year, as real estate curbs, tighter liquidity, less infrastructure projects and the hike in raw material costs hampered demand. Exports, however, were on the rise as overseas economies make a comeback.
Indian consumer inflation rose to 4.5% in October (+5.0% in cities), a small rise from the prior month. This was higher than anticipated.
Indian industrial production data disappointed however, rising at only a +3.2% annual rate in September when it rose +12% in August. That is a fast and worrying slowdown for the world's sixth largest economy.
EU industrial production in September also disappointed, slipping slightly, although less than was forecast.
In Australia, inflation expectations rose to 4.6% in November from 3.6% in October. That is a sharper jump than the actual inflation in September of 3.0%.
And staying in Australia, Delta cases in Victoria have slipped to 1115 cases reported there yesterday. There are now 16,098 active cases in the state (another increase) and there were another 9 deaths yesterday. In NSW there were another 286 new community cases reported yesterday with 2,845 active locally acquired cases (both increases too), and they had another two deaths yesterday. Queensland is reporting two new cases. The ACT has 15 new cases. Overall in Australia, just over 82% of eligible Aussies are fully vaccinated, plus under 8% have now had only one shot so far.
The UST 10yr yield opens today at 1.58% and little-changed since this time yesterday but it is +13 bps higher than a week ago although little changed from the start of the month. The US 2-10 rate curve starts today unchanged at +105 bps. And their 1-5 curve is marginally steeper at +107 bps, while their 3m-10 year curve is also a little steeper at +152 bps. The Australian Govt ten year benchmark rate is down -3 bps at 1.79%. The China Govt ten year bond is unchanged at 2.95%. The New Zealand Govt ten year is also unchanged at 2.63%.
In equity markets, Wall Street has started their Friday session with a +0.7% gain in the S&P500 reducing the weekly loss to -0.5%. Overnight, European markets were mixed again, with Paris up +0.5% and London down -0.5%. Most closed with gains for the week, with the largest in Paris. Yesterday, Tokyo rose +1.1% (but was down -0.4% for the week), Hong Kong rose +0.3% (up +2.4% for the week) and Shanghai rose +0.2% (+1.4%). The ASX200 ended +0.8% higher (-0.2%), and the NZX50 ended down -0.9% (and down -1.3% for the week).
The price of gold will start today up +US$2 to US$1864/oz and to a new 5 month high. For the week it has risen +2.8%.
And oil prices are little-changed at just over US$79.50/bbl in the US, while the international Brent price is now just over US$81.50/bbl and a -US$1 dip over the whole week.
The Kiwi dollar opens today little-changed at 70.4 USc but that is a -1% depreciation for the week. Against the Australian dollar we are soft at 96.1 AUc. Against the euro we are firmish at 61.5 euro cents. That means our TWI-5 starts today at just on 74.6 and only -½% lower for the week.
The bitcoin price has slipped back further and is now at US$63,321 and another -2.8% retreat from this time yesterday. For the week it is +3.8% higher however. So far in November it is +3.2% higher. Volatility over the past 24 hours has moderate at just over +/-2.5%.
The easiest place to stay up with event risk today is by following our Economic Calendar here ».
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