Here's our summary of key economic events overnight that affect New Zealand with news trade and tariffs are in the headlines, but their impact of higher inflation and slower economic activity are just starting to be seen.
US initial jobless claims rose sharply last week in seasonally adjusted terms, the largest rise in five month. In actual terms they were basically unchanged when seasonal factors would have normally brought a good reduction in claims. These initial claim levels are +10% high that year ago levels and there are now 2.17 mln people on these jobless benefits, also much higher than a year ago.
US durable goods orders rose +3.1% in January from December, but there was a sharpish revision lower in the December data. The January level is +4.3% higher than year-ago levels. Non-defense capital goods were up +2.2% from a year ago.
The second estimate of Q4-2024 GDP came in unchanged from the first at +2.3% growth. It would have been more but they noticed higher inflation in the period which trimmed the rising nominal expansion in the period.
Pending home sales in the United States fell -5.2% in January from a year ago, following a -5% drop in December.
And today's downbeat American economic data releases extended to the Kansas City Fed factory survey which fell in February, contracting by its most in five months.
The US Administration said China will be hit with a new 10% tariff, the latest salvo in the US president's steadily escalating trade fights. That is on top of the earlier 10% already in place. The President also said he intended to move forward with a threatened 25% tax on imports from Canada and Mexico, which is set to come into effect on 4 March.
So it is little wonder that inflation expectations are rising among Americans. Tariffs are a tax on yourself, and higher prices either result from more expensive imported goods, or they allow local producers to face much less price competition so those prices rise too. It will be impossible for the US Fed to ignore, and bond markets aren't either.
But north of the border, Canada said weekly earnings are rising faster there. They rose +5.8% in December from a year ago in data released overnight, the fastest pace since March 2021.
And staying in Canada, the reaction to the endless Trump insults are generating a "Buy Canada, Bye America" surge, and now apps are sprouting up enabling such choices right in shop and supermarket aisles. Apparently there are export markets for such services, especially in Europe.
The tracking of consumer and business sentiment in the EU shows it is either holding or moving up in January. Now almost as many are positive as negative, which is the best they have had in almost three years, and slightly better than expected.
With all the US tariff news, it will be no surprise to learn that container freight rates fell another -6% last week, taking them -30% lower than year-ago levels, and now only +85% higher than pre-pandemic levels. Usage of the Suez Canal is normalising now too. But bulk cargo rates shot up +32% last week from the week before to be -40% lower than year-ago levels.
The UST 10yr yield is at 4.29%, up +2 bps from yesterday at this time. The key 2-10 yield curve is holding at +19 bps. Their 1-5 curve is now inverted, now by -4 bps. And their 3 mth-10yr curve is also inverted -4 bps. The Australian 10 year bond yield starts today at 4.39% and down -1 bp from yesterday. The China 10 year bond rate is now at 1.79% and up +2 bps. The NZ Government 10 year bond rate is now at 4.61%, also up +1 bp from yesterday.
Wall Street has opened its Thursday session with the S&P500 little-changed. Overnight, European markets were mixed with London +0.3% higher, and Frankfurt down -1.2%. Tokyo ended its Thursday session up +0.3%, Hong Kong fell -0.3%, while Shanghai rose +0.2%. Singapore also rose +0.3%. The ASX200 was up +0.3% as well in Thursday trade. And the NZX50 recovered another +0.7%, the best of the markets we follow.
The price of gold will start today at just under US$2875/oz and down -US$35 from yesterday.
Oil prices are up +US$1 at on US$70/bbl in the US and the international Brent price is now under US$74/bbl.
The Kiwi dollar is now at 56.5 USc and down -60 bps from yesterday. Against the Aussie we are unchanged at 90.3 AUc. Against the euro we are down -10 bps at 54.2 euro cents. That all means our TWI-5 starts today just over 66.5, and down a net -40 bps from yesterday.
The bitcoin price starts today at US$84,968 and -2.3% from this time yesterday. It is currently very much in a bear phase with prices only rising when there is minor volume, but falling sharply when there is high volume. Sellers are choosing their timing, and there are a lot of them. Volatility over the past 24 hours has been moderate at +/- 2.8%.
Daily exchange rates
Select chart tabs
The easiest place to stay up with event risk is by following our Economic Calendar here ».
55 Comments
I'm leaving on a jet plane, don't know if I'll be back again, leaving on a jet plane....
I wish you the best, good luck!
Are you a bitcoin?
If freight plummets will that offset oil price increases due to a weaker dollar? I'm not sure which is the bigger lever.
Looking at the detail of the four-year term proposal I like it - it gives an option for a government to choose a 4-year term instead of a 3-year term after the election provided the select committees are proportional to the MPs not in the executive. That would give the opposition majorities in most select committees, which would help to hold the government to account. This is a neat feature that I'd vote for.
Of course, the average voter won't bother to try to understand it, so it will fail.
Either that or the big 2 parties will collude to remove this function so they don't have to be accountable, which will cause it to fail.
It won’t happen. The electorate is full of distrust and mistrust, take your pick. Surveys on trustworthiness position politicians in the vicinity of used car sales people and lawyers. Politicians have worked very hard to attain this status. Not all of them though but if a government after three years is going well the electorate would normally expect to keep them going.
I wonder if used car salesmen are now considered more trustworthy than the media ? "...the proportion of those who actively avoid the news to some extent grew from 69% in 2023 to 75% in 2024"
https://www.stats.govt.nz/news/new-zealanders-trust-in-key-institutions…
https://www.1news.co.nz/2024/04/08/kiwi-trust-in-news-now-well-below-gl…
Best not to actually identify, but from memory, over the years, there have been quite a number of political identities who have got hooked up with media identities. Birds of the feather flock together?
Morning 'news' on TV is now not news. It is opinion pieces of the presenters. Therefore I do not watch morning news any more...
"Jenny Shipley likens David Seymour to a 'second-hand car salesman..."
Pot, kettle...
Jenny does not know how to spell governance
Her main income now comes from sitting between warring Iwi (hence her hatred of David) and mediating common ground in private....
Claims against failed national builder Mainzeal have risen to $159 million but liquidators settled matters with former Prime Minister Dame Jenny Shipley over $6.6m after last year’s Supreme Court ruling found she was liable to pay that.
Precisely how she and the other two directors settled their $6.6m payments was not stated.
Whose pocket does she find herself in?
No to the 4 year term. They already ignore us, eg. the reviews and submissions on MMP were all disregarded. A total waste of time for all involved. How about binding referendums? - way too democratic I guess.
I see ads for Du Val here, i thought they went bust?
Liquidator is selling off portfolio
Everyone loves a bargain!
Not according to Kenyon Clarke. It's all BAU.
The 'Made in NZ' campaign was good to begin with, but has very much faded over time.
However I still do favour things made here, or more generally anywhere other than China.
"Made in NZ" quickly became "Ripoff NZ"
I became made in China with a sticker put on it saying made in NZ, or with a slight tweak then adding the label. All for 8x the price of imported good the same.
You might like the right to repair Bill currently open for submissions. It would hopefully reduce imports of finished products
Have your say on the Consumer Guarantees (Right to Repair) Amendment Bill - New Zealand Parliament
I am a master of finding technical service manuals online... but they should actually be supplied in a much simpler fashion....
The fact we need a law for this shows how far out of whack we are.
From mobile phones to motor vehicles, the manufacturers have made it exceedingly difficult.
How easy will it be for them to effectively go "backwards" in the use of hardware components, let alone the software side?
This 'Repair Bill' should be paid attention to. It will enable you to buy a new appliance or even a car, I believe, that must be repairable for the projected life-time of that product. Inotherwords, parts should be available for the life-time of the product and if it's too complicated to be fixed by the consumer then the seller must be able to tell you someone who can reliably repair it.
This pressure should ultimately force the manufacture to make a product which is repairable by the consumer if it hasn't reached its projected life duration.
Consumer.org NZ publishes, sporadically, lifetime expectations of many appliance products.
In my opinion new vehicles should fall under this law for a lifetime of at least 20 years.
Manufacturers should also have to make small repairs such as changing a car's light-bulb a process which is easy for the owner to do himself.
Tariffs on Canadian and Mexican goods scheduled to go into effect on March 4 “will, indeed, go into effect, as scheduled,” Trump said on Truth Social.
however if he does this with Canada and Mexico in the current form, it will kill the US Automotive Industry overnight..
Art of the deal?
How can anyone think this is a business friendly government when they are kicking up so much chaos? No one will invest knowing that the foundations of your investment decision could shift dramatically every time someone new gets an audience with Trump.
Screw businesses, then buy the distressed business assets perhaps? All manufactured by the ruling elite.
If the canadian government is worth their salt they will call an election as soon as the Tarrifs come in. Trump has help turn a likely landslide loss into a good chance of a win for the incumbents.
Maybe the supposed global right wing revolution that trump was said to usher in is already faltering before it begins.
"the incumbents" are still leaderless atm Who might replace Trudeau as Liberal Party leader?
the polls dramatically show that dumping Trudeau has "...help turn a likely landslide loss into a good chance of a win...." Opinion polling for the 2025 Canadian federal election - Wikipedia
Polymarket is showing a 66% chance of Poilievre winning vs 35% for Carney. Before their closest ally started attacking them, Poilievre was hanging around the 90% mark.
He must be pretty pissed off with Trump muddying the waters of what looked like a sure thing.
Edit: I realise my probabilities add up to more than 100% - that's Polymarket's rounding, not mine.
Yeah Poilievre had based his whole campaign about how 'Canada is broken'. Then Trump came in and now all of a sudden they are desperately trying to rebrand themselves and their campaign like it never happened.
Reminds me of how Simon Bridges bottled it before the 2020 election. Only really had one strategy and didnt realise the game had changed until it was far too late and got rolled.
wow a couple of recent polls there actually show the Liberals ahead. What a dramatic turn around.
crazy huh! Maybe that's what Luxon needs here to prop up his flailing prime ministership - pick a fight with Trump!
He simply could not make a definitive enough statement to fight over. I imagine he could make another head of state extremely angry but only over his incessant "what I would say to you".
Japan going extinct.
"Japan births fall to lowest in 125 years
Number of babies born declines 5% despite efforts to boost fertility rate"
https://www.ft.com/content/95d3282e-daef-4670-b704-c1215393e7f8
And so said the good King of Id to his peasants - I have good news and bad news. First the bad news, I am going to nationalise all your pension funds. And now for the good news, you will all be allowed to work until you are ninety.
All those badly maintained houses there... Appear to be very cheap but try to sell one in a few years time...
Sounds like NZ but we charge 5 x for them and think they will be still good in 50 years?
How long are Japanese house made to last for -30 years
Unlike many other countries where homes are built to last for generations, some houses in Japan are constructed to stand for a mere 30 years before being demolished and rebuilt. This practice is not only a reflection of cultural beliefs but also a pragmatic response to the ever-present threat of natural disasters
In the new paradigm of doing more with less. Japan may be perfectly positioned to take advantage.
https://www.oneroof.co.nz/news/some-very-famous-people-hollywood-intere…
We are so embarrassing, that article makes me cringe. One Roof is utterly shameless.
It is a great block at a seemingly good price though.
Going out in a blaze of glory - possibly much like some commenters here this afternoon.
If it is correct that out of all the readers of this site only about 150 comment then the exodus may not be that significant as amongst that, some more than others contribute on a daily basis. That contingent is fairly dedicated and suggests most of them enjoy the participation to the point that the modest subscription is worthwhile.
Does that count include the users with multiple usernames?
Not sure but one development I hope is it putting an end to the little partisan coven that enrols every election year, head nod, parrot and uptick one another’s posts and then disappear. Good riddance.
We are so embarrassing, that article makes me cringe. One Roof is utterly shameless.
If you want to see embarrassing, watch the real estate promo video. Ugly old white dude who for some reason gets a young woman to walk around in her bikini for part of it, it's like the 1970s
There is a link to a map in this story which shows where Auckland Transport has been forced to do blanket increases to speed limits because of the National Party ideologically driven transport policy led by Simeon Brown and enabled by Christopher Luxon.
https://experience.arcgis.com/experience/9174fbf158714d76b582b8bc6fe95d…
I suggest, that if you live in Auckland you zoom into your suburb or suburbs of family and friends who have school age kids and look at what National are implementing.
I'm not sure people actually realise that what National are doing is doing a blanket raising of speed limits on residential streets around schools to 50kmh. The variable speed limits around schools (proven to be ineffective) only applies to the bit directly in front of a school.
I have yet to meet a resident (of any political persuasion) who wants faster speeds outside their property.
You don't know anyone on a back section?
Yes. They don't want extra speeding traffic on their residential street either. It devalues the appeal of the street if there are people speeding down there.
Nothing against you agno, but personally i’ve never thought about it in terms of value. That line of thinking is founded in the never-ending house price growth mentality of which i feel you don’t prescribe to (rational), which makes your comment perplexing. From a safety aspect i see the concern
> The variable speed limits around schools (proven to be ineffective) only applies to the bit directly in front of a school.
Incorrect, the variable speed limit does not apply to the whole school frontage. Only 150m each side of the entrance gate. So it's only protecting kids whose parents drive them up to the gate. No doubt Simeon would have preferred an even shorter distance, but 300m is the minimum length for a speed zone.
Yes, it's even worse than my description made it sound which is pretty damning.
No idea how anyone can possibly claim this increases economic productivity in any way whatsoever. If anything it will mean less kids walking which means more congestion and more time parents need to spend driving their kids to school so worse economic productivity. What a f****ing useless drop-kick Simeon is.
We welcome your comments below. If you are not already registered, please register to comment.
Remember we welcome robust, respectful and insightful debate. We don't welcome abusive or defamatory comments and will de-register those repeatedly making such comments. Our current comment policy is here.