Here’s a rundown of the weekend’s key economic events impacting New Zealand, including signs of a US slowdown in 2023 that Wall Street expects as China shows signs of struggling. hasn’t appeared yet.
But first, all eyes will be on the US Federal Reserve’s interest rate decision on Thursday (NZT) next week. Also on Thursday, Fonterra will announce its profit results, which are expected to be an unusually strong result. Additionally, in the US, all eyes will be on September’s PMI statistics to be released over the weekend, as well as several housing indicators released before then, including housing starts, building permits and existing home sales. The central banks of the UK, Japan, China, Turkey, Norway, Sweden, Thailand, Switzerland, Brazil, Indonesia, the Philippines and South Africa all plan to review their monetary policies and interest rates. All eyes will be on updates to inflation rates in the UK, Canada and Japan. PMI data will also be released for France, Germany, the UK, the Eurozone, Japan and Australia.
China on the weekend Said New home prices in August fell 0.1% from July, the same rate of decline as the previous month. Given the known low sales levels, this seems like a questionable result, especially since only 16 of the 70 largest cities report prices holding steady or increasing slightly. The rest fell out. Out of 70 major cities, prices for existing homes rose slightly in August from July in only three cities. Slips reported in 67 other cities were strikingly similar, and they also failed the odor test.This has it all significant impact Regarding the amount of international travel and the level of visitors from China.
China too Said “The total retail sales of consumer goods was 3,793.3 billion yuan, an increase of +4.6% from the previous year. Of this, the retail sales of consumer goods excluding automobiles was 3,382 million yuan, an increase of +5.1%. This is actually a very good thing. But a simple calculation to extract from that “automobile retail sales” showed essentially zero growth.
Meanwhile, the Chinese electricity production August saw a decline of -2.5% from July, which is a significant drop for a country as large as China. Year-on-year, electricity production only increased by +1.1%, which again does not indicate economic expansion. But nevertheless, they report Industrial production increased by +4.5% compared to the previous year. Either China has recently experienced an incredible explosion in energy efficiency and a decline in energy density, or either those statistics are unreliable.
Foreign direct investment was also struggling. “The actual amount of foreign capital used was 847.17 billion yuan, down -5.1% year-on-year,” they announced. report. However, considering them, report The seven-month total was 767 billion yen, meaning inflows in August were 80 billion yen, or less than NZ$19 billion, but this is a slowdown in the pace seen recently and China’s This is a small amount for such a large economy.
Over the weekend, the Central Bank of Russia raised To combat rising inflation and protect the ruble, the policy rate will be increased by 100 bps to 13%.They can’t seem to get up from there 1 USc value. Meanwhile, Russia’s inflation rate is rising again, currently at 5.2%, and the central bank expects it to rise to 7% by the end of the year.
indian export Although sales rose in August from July on a normal seasonal basis, they fell -6.9% year-on-year due to soaring commodity prices and weaker external demand. Imports also decreased, leading to an increase in the trade deficit.
In the United States, industrial production The month-on-month increase of +0.4% in August exceeded market expectations for a +0.1% rise and compared with the downwardly revised +0.7% increase in July. The year-on-year comparison was a slight increase of +0.2%. One sector that has kept these levels positive is mining (including oil production).
but New York State Factory Survey It turned significantly positive in September. The Comprehensive Business Conditions Index rose 21 points to +1.9. New orders and shipments increased. Delivery times remained stable and inventories continued to shrink. And perhaps more importantly, looking ahead, businesses continue to grow more optimistic about the outlook for the next six months.
However, US factory data probably won’t be broken in September for these reasons. Strike begins Three major automakers.
Also, the atmosphere in August was not so bright. University of Michigan Consumer Sentiment Survey, but. Although it has declined since July, it is still at a higher level than at any time since late 2021, except for the past two months. Consumers’ views on current sentiment, current conditions, and expectations for future conditions are all significantly higher than they were a year ago.
on the other hand, US Federal Reserve Balance Sheet The contraction continues, even if the decline over the past week has been relatively small.
UST 10-year bond yields started the day up +1 basis point at 4.34%, once again near August highs. A week ago, this rate was 4.26%, so it has increased +8bps from there. Their key 2-10 yield curve is unchanged at -70bps. And that his 1-5 curve is now -97 bps and that reversal will be less. The 3-month to 10-year curve inversion is much smaller and is now -106 bps. The Australian 10-year bond yield is currently 4.16%, unchanged from Saturday. China’s 10-year bond yield fell -1 basis point to 2.67%. And the NZ government 10-year bond interest rate is currently unchanged at 5.00%. One week ago, it was 5.00%.
gold price Starting today at exactly $1924 USD per ounce, up +2 USD from Saturday. And this is only a slight increase from a week ago level of US$1,920 per ounce.
Crude oil prices also rose +US$50 from Saturday to just under US$90.50 per barrel in the US, returning to a 10-month high. International prices for Brent are currently above $93.50 per barrel. But this week, it’s up +3.50 USD/barrel or +4%.
The Kiwi dollar opened today at US$59, little changed from this point yesterday and remains settled within a narrow range. A week ago it was 58.9 USc, so there has been little change since then. Against Australia they are holding at 91.8 AUc. Against the euro, it is still 55.4 euro cents. So TWI-5 is actually 68.5, almost unchanged, even after a week.
Bitcoin prices have risen slightly from this point on Saturday and are now at USD 26,486, a modest increase of 0.4%. A week ago, this price was 25,820 USD, so it has increased by +2.6% since then. In fact, it’s the first weekly increase since August. However, the volatility over the past 24 hours is very low, only +/-0.3%.
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