US jobs growth eases; Canada adds jobs; China property crisis worse, far from resolved; Germany struggles; world food prices stay low; UST 10yr 3.72%; gold and oil down; NZ$1 = 61.7; TWI = 69.7

Here's our summary of key economic events overnight that affect New Zealand with news commodity prices are tumbling today on the twin slowdowns in the US and especially China. With it, commodity currencies are being marked down.

First up today, the US economy created fewer new jobs in August than expected, adding +142,000 in August, and below market expectations of +160,000. July's increase was revised sharply lower. Most job gains occurred in construction and healthcare while manufacturing employment declined. But their jobless rate edged lower to 4.2% in August from 4.3% in July.

But we do need to note that the +142,000 rise is the seasonally-adjusted number. The actual rise is +263,000 from July which is pretty healthy, it must be said. From a year ago, payrolls are +2.3 mln larger. The economic impact of +2.3 mln more people employed is not insignificant.

Weekly earnings are up +3.5% from a year ago, hourly earnings up a bit more, and that was better than expected.

The US job market is cooling, but not cracking. This fact will give the US Fed more room to manoeuver at their meeting on September 19, in twelve days time.

Canada added +22,000 jobs in August, a recovery from the small dip in July. Almost all the August increase was for women.

But their local, and widely-watched Ivey PMI fell sharply in August, down to its lowest level since December 2020. But it wasn't matched by the internationally benchmarked S&P/Markit version which reported a stable situation. One of them isn't right.

In China, the end is nigh for struggling developer China Vanke. They reported terrible July metrics, and their liquidity situation worsened notably. Not helping them, China's regional banks are moving faster to quit nonperforming real estate loans. That is leaving the majors holding the bag as the government urges them to lend more to support a weak housing market. It is hard to see how the management of their real estate crisis won't end very badly. China's neighbours are increasingly concerned.

Germany reported a very tough situation for industrial production in July, down -5.3% from the same month a year ago and worse than the June result. But at least exports are limiting the downside. These were up +1.7% from June and that was a gain that was better than expected and one that clawed back its year-on-year dip.

In Australia, home loan activity for owner occupiers picked up in July, adding +AU$18.9 bln in the month and the most in two years. For investors the rise was +AU$11.7 bln which was an even faster rate of increase and the most since January 2022.

World food prices actually dipped in July with declines in cereal and meat prices in the month. Dairy prices rose. They remain their lowest in three years. Good agricultural conditions have persisted for some time now, boosting output. Updated forecasts for global cereal production point to a weather-driven drop in coarse grains offset by expected increases for wheat and rice. So far there is no indication yet that the world can't feed itself, and more than adequately, despite some high-profile pressures

The UST 10yr yield is now at just on 3.72% and down another -1 bp from yesterday. That is a -20 bps fall for the week The key 2-10 yield curve is now a positive +6 bps, the most since June 2022. Their 1-5 curve inversion is less at -63 bps. But their 3 mth-10yr curve inversion is unchanged at -144 bps. The Australian 10 year bond yield starts today at 3.98% and up +3 bps. The China 10 year bond rate is at 2.15%, up +4 bps after Beijing moved to 'correct' the market. The NZ Government 10 year bond rate is now just on 4.20% and down -1 bp from this time yesterday, but down -10 bps for the week.

Wall Street has moved lower with the S&P500 down -1.7% on the US jobs report. That puts it -3.6% lower for the week. Overnight, European markets were all down about -1%. Their weekly drop is similar to New York. Tokyo ended its Friday trade down a further -0.7% to be -6.8% lower for their week. Hong Kong didn't trade due to a weather shutdown but ended its week down -2.3% lower. And Shanghai fell -0.8% yesterday for a weekly drop of -2.4%. Singapore was was down just -0.1%. The ASX200 rose +0.4% in its Friday trade to be -1.0% lower for the week. And the NZX50 fell -0.5% in Friday trade but was up +1.4% for the week, outshining all the other bourses we monitor.

The Fear & Greed Index ends the week in the 'fear' range, from last week's 'greed' range, so quite a big shift.

The price of gold will start today down -US$20 from yesterday at US$2493/oz, but only down -US$8/oz from a week ago.

Oil prices are -US$1 lower at just under US$68/bbl in the US while the international Brent price is now at just on US$71.50/bbl. Both are down -US$5.50/bbl on a week or -7.5%.

The Kiwi dollar starts today down more than -½c from yesterday at 61.7 USc. That is -¾c lower in a week. Against the Aussie we are +10 bps firmer at 92.5 AUc. Against the euro we are also down -¼c at 55.7 euro cents. That all means our TWI-5 starts today at 69.7 and down -30 bps from yesterday, down -75 bps in a week.

The bitcoin price starts today at US$53,516 and down -5.0% from this time yesterday. And it is down -8.8% from this time last week. Volatility over the past 24 hours has been high at just on +/- 3.3%.

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