90 seconds at 9 am: US trade deficit rises, as do China's exports; US debt ceiling battles shift to more exotic solutions; Japan taking radical new measures; Australia happy with China buying; NZ$1 = US$0.836, TWI - 75.0

Here's my summary of the key news overnight in 90 seconds at 9 am, including news the US trade deficit widened unexpectedly in November, after a rise in the import of consumer goods. The figures showed that the gap widened by 16% to US$48.7bln. The markets were expecting the deficit to shrink. This deficit was the widest recorded since April last year. The news was perhaps less surprising in hindsight because China had earlier reported a sharp rise in exports.

Staying in the US, you will now know that the fiscal cliff crisis was avoided, but as at December 31, America hit its debt ceiling again. It is currently using accounting tricks to pay the bills, and will run out of those manoeuvers by mid February. We have become inured to the endless Congressional bickering about the US debt, but the problem is still real. Many wacky ideas have been raised - like the US$1 trillion platinum coin - but work goes on to find a more enduring solution. Over the weekend, the Democrats gave President Obama the ok to just bypass the debt limit. That would create another fight that would need to be tested by the US Supreme Court.

Kicking the can has become a dramatic farce in Washington. In many US states however, there is experimentation with other public funding ideas, some of these quite radical. These battles are important to us because of the impact they can have on our exchange rate, and demand for China's exports. We can't do anything about it, but it can affect us.

Back in the real world, Japan is rushing toward a radical shift in their monetary and fiscal policies. This could affect us too, because Japan is the third largest economy in the world. New prime minister Abe has called for dramatic measures to get inflation back up, and up to 2%. He is faulting the Bank of Japan for its current efforts and wants to replace its Governor. Forgive the pun, but they are going for the 'nuclear option' - aggressive fiscal and monetary easing on a massive scale. Among the radical ideas is the buying of equity stakes in major companies with printed money and forcing those companies to spend and invest. Japan's whole economic viability is at stake.

Chinese trade data is coming under scrutiny. China’s unexpected surge in exports in November renewed concern from analysts that statistics from the nation can be unreliable. We will have more on this in today's Top 10.

But the Australian Treasurer remains optimistic that China is growing, and will continue to feast on Aussie minerals. They are watching the current iron ore prise rise, but the companies themselves are worried it may not last and a price slump is a realistic possibility.

Back here, this week the major news is the release of the inflation data for December, which comes out on Friday.

The NZ$ starts today at 83.6 USc, 79.4 AUc and the TWI is at 75.0, all levels remarkably similar to the ones we ended at on Christmas eve.