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Podcast: Economy Watch
Episode:

Rising confidence underpins global expansion
Category: Business
Duration: 00:03:57
Publish Date: 2021-06-29 19:32:51
Description:

Kia ora,

Welcome to Wednesday's Economy Watch where we follow the economic events and trends that affect New Zealand.

I'm David Chaston and this is the International edition from Interest.co.nz.

Today we lead with news consumer confidence is high in the US, the EU and even China, underpinning good levels of economic activity.

American consumer sentiment as measured by the US Conference Board rose impressively in their June survey. It is now at its highest level since the start of the pandemic and back to 2018 levels. The proportion of consumers planning to purchase houses, cars, and major appliances all rose, a sign that consumer spending will continue to support economic growth in the short-term. Vacation intentions also rose, reflecting a continued increase in spending on services.

The Case-Shiller National Home Price Index jumped almost 15% in the year that ended in April. Intense competition for a limited number of homes in their market pushed home-price growth to the highest annual rate since this index began 34 years ago.

American manufacturing is about to get a good boost with major airline United ordering 200 Boeing 737 Max jets and 70 Airbus A321neo planes, a deal valued at about US$15 bln.

Japanese retail sales data for May was released yesterday and it came in better than expected - which means it did not fall.

In Hong Kong, the courts and judiciary are about to be folded into the Chinese system where they are expected to be CPC agents.

In the EU, overall sentiment between both the consumer and business sectors reached a 21 year high in June, at levels far above their long term averages. The gains were widespread, notably in their services sector, and notably for employment. Germany led the way, but of the six largest EU economies, only Spain was a laggard.

The German consumer inflation rate came in at a modest +2.3% for June, similar to May, and not yet reflecting the much sharper +4.2% input price increases its producers were facing in Q1.

In Australia, it appears that the NSW Delta pandemic outbreak isn't expanding significantly and that promises relief from the near-nationwide partial lockdown in the foreseeable future. One thing it has done however is unite the states against the Federal Government's handling of their vaccine rollout.

The UST 10yr yield starts today at 1.48% and unchanged. 

The price of gold starts at US$1762/oz which is down -US$18/oz from this time yesterday. Silver has fallen relatively more, down -1.3%.

Oil prices are holding today. In the US they are still at just over US$72.50/bbl, while the international Brent price is still just over US$74/bbl. OPEC is meeting but can't agree on what their future policies should be.

The Kiwi dollar opens today a full -½c weaker and back at 69.9 USc. Against the Australian dollar we are unchanged at 93.1 AUc. Against the euro we are soft too at 58.8 euro cents. That means our TWI-5 starts today softer at 72.5 and back where we were a week ago.

The bitcoin price is now at US$36,326 and up a strong +6.3% from this time yesterday. Volatility in the past 24 hours has remained high at +/- 3.9%.

You can find links to the articles mentioned today in our show notes.

And get more news affecting the economy in New Zealand from interest.co.nz.

Kia ora. I'm David Chaston and we’ll do this again tomorrow.
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