US rate rises may come in Q2 2015; small gain on TARP; China bigger; UK fx arrest; bitcoin not money or currency; NZ$1 = 77.3 USc, TWI = 78.5

Here's my summary of the key issues that affect New Zealand over the weekend with news the Fed's decisions are still sinking in to market thinking.

A top Fed official said on Saturday that American inflation will likely still be "well below" the central bank's 2% target next year, but they will still likely begin raising their policy rate, starting in June. Or even earlier.

In Washington the US government has closed the books on its 2008 TARP (Troubled assets relief program) where it spent US$426 bln bailing out carmakers GM and Chrysler, insurer AIG, and banks Citibank and Bank of America. It has now got back US441 bln. The final bit happened over the weekend when it sold out of its Ally Financial position, part of the GM bailout.

And in another echo from the past, China said over the weekend that the size of its economy in 2013 was 3.4% larger than previously reported and that its GDP reached US$9.6 trillion.

In the UK there are reports that police have arrested an ex-RBS trader in relation to their currency rigging scandal.

In Australia, Fisher & Paykel has been fined AU$400,000 following action by their competition watchdog for wrongly telling customers they needed to buy an extended warranty.

And staying in Australia, businesses that trade bitcoins and other cryptocurrencies will need to add GST on those transactions from July 1, 2015 in a final ruling by the Australian Taxation Office. Bitcoin is neither money nor foreign currency, they have ruled. In something that may or may not relate, the ATO website is down and they are "working to restore the service" this morning. Perhaps this decision has generated some upset people.

In New York, benchmark UST 10 year bond yields eased back on Friday after the sharp rise the day before and are now at 2.16%.

The oil price also rose at the end of last week to US$58/barrel and Brent crude to US$62/barrel. It is looking more like the current floor price is US$60/barrel after the very sharp readjustment down.

The gold price is basically unchanged again at US$1,197/oz.

We start today at 77.3 USc, at 95.2 AUc a new nine year high, and the TWI is at 78.5.

If you want to catch up with all the changes on Friday we have an update here.

This is our final 90 @ 9 summary for 2014. We will be back again on January 19. However we will be producing a daily holiday briefing each business day until then.

From the whole interest.co.nz team, we wish you a Merry Christmas. Enjoy your holiday break.

The easiest place to stay up with event risk over the holiday period is by following our Economic Calendar here »