US data weak ahead of CPI release; Study confirms US pays the tariff-taxes; India CPI rises; China ready for big holiday; Australia inflation expectations rise; UST 10yr at 4.11%; gold and oil down; AU$1 = 60.5 USc

Here's our summary of key economic events overnight that affect Australia with news global financial markets are showing nerves ahead of tomorrow's US CPI data, not only because there is upside risk that will restrain the US Fed from, rate cuts, but also gun-shy after getting non-farm payrolls reports they basically didn't believe. Sanitised US data is a risk no-one wants (other than the White House.)

First in the US, there were 248,000 initial jobless claims last week, a small decrease but the one explained by seasonal factors. There are now 2.215 mln people on these benefits, more than the 2.19 mln in the same week a year ago.

And American existing home sales came in sharply lower in January that the good December level. They ran at a -4.4% lower rate than in January 2025, and even lower than the unusually low January 2024 level. They fell everywhere and was the largest fall in four years, although prices rose marginally from a year ago.

The New York Fed released a detailed review of "who pays" the Trump tariff taxes, and surprise, surprise, they found it is almost exclusively (90%) Americans who pay. Who knew? They also found that after these tariffs, China's share of US imports is basically unchanged. Some people are slow learners - tariff taxes are a tax on yourself. But you have to take stage one economics to learn this stuff.

In India, they released CPI inflation data overnight and it came in at 2.75%, their highest since May. And we should also probably note that protests in India are growing against their recently-agreed free-trade deal with the US.

In China, their Spring Festival / Chinese New Year formally starts on Tuesday, and a lot depends on the consumer spending patterns during this two week annual break. Forward bookings for travel indicate a record level of travel, a sharp jump in international travel, and a preference for independent, non-package holidays. Thailand, Russia, Turkey and the Philippines are getting outsized bookings this year.

Separately, China has rolled back its steep tariff penalty on EU dairy products.

In Australia. consumer inflation expectations rose in February to 5.0%. This follows a seven-month period of below five-per cent expectations. The increase in February is present across a number of inflation expectations measures.

And staying in Australia, chances are rising that extended drought conditions related to the return of an El Niño weather pattern that may come later in 2026. It will be hotter there too. If that occurs, there will be spillover implications for New Zealand, particularly for the rural sector.

Global container freight rates were little-changed last week (-1%), to be -38% lower than year-ago levels. Once again, the key change were weaker outbound China rates. Although shifting in between, bulk cargo rates are essentially unchanged from a week ago, but they are +150% higher than year-ago levels. (But that base was unusually low.)

The UST 10yr yield is now just over 4.11%, and down -6 bps from yesterday in a hard shift to 'safety'. The key 2-10 yield curve is little-changed at +66 bps (+1 bp). Their 1-5 curve is flatter at just under +23 bps (-4 bps) and the 3 mth-10yr curve is also flatter at +43 bps (down -2 bps). The China 10 year bond rate is down -2 bps at just on 1.78%. The Japanese 10 year bond yield is little-changed at 2.23%. The Australian 10 year bond yield starts today at 4.75%, down -3 bps. 

Wall Street has started its Thursday with the S&P500 down -1.3%. Overnight, European markets were mixed between London's -0.7% fall and Paris's +0.3% rise. Yesterday Tokyo ended is trade Thursday little-changed. Hong Kong was down -0.9%. Shanghai closed little-changed. Singapore also closed up +0.6%. The ASX200 ended its Thursday up +0.3%. 

The price of gold will start today down -US$122 from yesterday at US$4953/oz. Silver is down a very sharp -US$8 at US$76/oz and even more volatility.

American oil prices are down -US$2 at just over US$63/bbl, while the international Brent price is now just under US$68/bbl.

The Australian dollar is down -30 bps against the USD from yesterday, now just over 71.1 USc. Against the Japanese yen we are down -60 bps at ¥108.6. Against the euro we are down -20 bps at 59.9 euro cents. 

The bitcoin price starts today at US$66,288 and up +0.5% from this time yesterday. Volatility over the past 24 hours has been modest at just on +/- 1.7%.