US jobs growth tame, consumer confidence dives; China industry profits rise; EU-India deal signed; Swedes eye euro; Australia business sentiment holds; UST 10yr at 4.23%; gold on hold; oil firmer; AU$1 = 69.8 USc

Here's our summary of key economic events overnight that affect Australia with news the US dollar fell for a fourth consecutive session today, sliding to its lowest level since February 2022. It's a -3.5% devaluation in just one week.

Some think the US Administration is engineering the fall to bolster its export competitiveness as the US factory sector misfires, tariffs aren't working other than raising costs, and to put pressure on the Fed ahead of its meeting tomorrow.

First up today in the US, the weekly ADP employment update recorded a weekly gain of under +8000, continuing the slow easing that they have been recording since the end of November. January non-farm payrolls which will be released at the end of next week, is currently expected to show a very tame +40,000 jobs gain which will continue the weak run that started in May 2025.

And that may be optimistic, The Conference Board's consumer sentiment survey for January reported that confidence collapsed to lowest point since 2014, to levels even lower than the pandemic depths. It is now back to levels as it rose from the GFC.

But the latest factory survey, this one by the Richmond Fed in the mid-Atlantic states, showed little-change from its already negative levels. New order levels rose marginally however, but because that is on a dollar basis it might just be because the same survey shows high price increase activity, required by even higher cost increase levels.

More positive was the January Dallas Fed services survey, which moved up into positive territory in January after four months of consecutive retreat.

Today's US Treasury 5yr Note auction brought the same median yield rise from the prior equivalent event a month ago. Higher risk premiums are getting embedded

In China, industrial profits rose +5.3% in December from the same month a year ago. They will be pleased with that because for the whole of calendar 2025 they were up merely +0.6% (and would have declined but for the December rise).

In India, we can confirm the signing of their big trade deal with the EU, removing both tariff and non-tariff barriers. The US isn't happy.

In Europe, we should note that Swedish officials are looking at what it would take to ditch the krona in favour of the euro. An independent review has already pointed out that the benefits would greatly outweigh the costs. The Swedes last voted on this issue in 2003.

Here in Australia, business sentiment as measured by the NAB survey was stable and mildly positive in December. Business conditions however improved more strongly on better sales and margins.

Later today, we get our December CPI result, and after the strong labour market for January, will be closely followed and could very well move financial markets. We had 3.4% inflation in November and this December result is expected to be 3.6%. This will be very influential on the RBA's deliberations at next Tuesday's cash rate target review.

The UST 10yr yield is now just on 4.23%, up +2 bps from this time yesterday. The key 2-10 yield curve is now at +64 bps (up +2 bps). Their 1-5 curve is now at +30 bps (unchanged) and the 3 mth-10yr curve is now at +52 bps (also unchanged). The China 10 year bond rate is down -2 bps at 1.80%. The Japanese 10 year bond yield is up +5 bps at 2.29% and the bond market crash continues. The Australian 10 year bond yield starts today at 4.85%, up +4 bps from yesterday. 

Wall Street higher with the S&P500 up +0.4% in Tuesday trade. Overnight, European markets were mixed between Frankfurt's -0.1% dip and London's +0.6% firming. Yesterday Tokyo ended its Tuesday session recovering +0.8%. Hong Kong was up +1.4% and Shanghai was up +0.2%. Singapore ended up a very strong +1.3%. The ASX200 returned from holiday with a +0.9% rise. 

The price of gold will start today at US$5087/oz, unchanged from yesterday and holding at its record high. Silver is down to US$107/oz. Platinum has fallen more sharply and now at US$2522, down -US$335/oz from yesterday.

American oil prices are up +US$1 at just under US$62/bbl, while the international Brent price is firmish, now just under US$67/bbl and up a bit more. This is all USD devaluation-driven.

The Australian dollar is up +70 bps from yesterday, now at 69.8 USc as the greenback goes into another devaluation stage. Against the Japanese yen we are up +20 bps at ¥106.8. Against the euro we are unchanged at 58.2 euro cents.

The bitcoin price starts today at US$88,576 and up +1.0% from this time yesterday. Volatility over the past 24 hours has been low at just under +/- 0.9%.