Here's our summary of key economic events overnight that affect Australia with news of shrinking employment in the US. The pullbacks are widespread, and ominous.
The US economy shed -92,000 jobs in February at the headline level, the most in four months, following a downwardly revised +126,000 rise in January and much worse than forecasts of a +59,000 gain. From a year ago, payrolls are up +129,000 and that is unusually low. Apart from December's tiny +59,000 year-on-year gain you have to go back to the pandemic (and Trump 1) to fund as weak a rise. It gets worse by broadening the view of all employment, not just payroll employment. That broader view shows overall employment down -391,000 in February from a year ago, the second consecutive shrinkage.
US retail sales inched lower by -0.2% in January from December, slightly less that the expected dip. It was the first decline since October. From a year ago, they are +3.1% higher. Most of this is accounted for by 2.5% CPI core inflation.
In Canada, their widely-watched Ivey PMI surged higher in February, a strong expansion signal, to its best since September 2025, and prior to that its best since July 2024.
In the Persian Gulf, the Qatari oil minister said in the next few days they have to decide whether to declare force majeure, releasing them from obligations to deliver supplies to customers. He said that could drive crude prices to US$150/bbl.
After falling consistently since August, the FAO food price index rose in February, basically tracking similar levels for the start of 2025. But there is wide variation between categories. Meat prices are steady, Dairy prices are falling as is sugar. Dairy prices are now at their lowest since the start of 2024. But vegetable oils are rising, and fast, with cereal prices turning higher too.
Meanwhile, metals prices are rising, led by aluminium's overnight jump, and it is now approaching the heady heights of the pandemic peaks. Copper and zinc have been rising recently too, even nickel and zinc. But iron ore prices are not joining the party.
Also worth noting is the meeting starting on Monday in Jamaica about the regulation of deep sea mining. The International Seabed Authority, the UN-established body will wrestle with ocean governance as governments weigh whether to allow deep sea mining in international waters or impose a global moratorium while science and regulations catch up.
This is interesting. Start at 39:50.
The UST 10yr yield is now just on 4.11%, down -3 bps from yesterday. The key 2-10 yield curve is steeper at +58 bps (+3 bps). Their 1-5 curve is steeper at just on +15 bps (+1 bp) and the 3 mth-10yr curve is now at just on +41 bps (-3 bps). The China 10 year bond rate is stable at just on 1.79%. The Japanese 10 year bond yield is up +3 bps at 2.18%. The Australian 10 year bond yield starts today at 4.89%, up +9 bps from yesterday.
And we should probably note that the Australian 10 year has risen to hits highest level since 2011, and the premium over the equivalent New Zealand government ten year yield is now +37 bps. Inflation differentials are driving this separation.
Wall Street has opened its Friday trade with the S&P500 down -0.8% and falling. There aren't any 'dip' buyers today. Overnight European markets were down between Paris's -0.7% and London's -1.2%. Yesterday Tokyo ended its Thursday session up +0.6%. Hong Kong was up +1.7% and Shanghai was up +0.4%. Singapore was unchanged. The ASX200 ended its Friday session down -1.0%.
The Fear & Greed index is harder over in the 'fear' zone.
The price of gold will start today up +US$68 from yesterday at US$5144/oz. Silver is up +US$2 at US$84/oz today.
American oil prices are up more than +US$10, up +13.2% in a day, at just under US$90/bbl, while the international Brent price is up a bit less to be now just on US$92/bbl.
The Australian dollar is unchanged against the USD from yesterday, still just on 70.2 USc. Against the Japanese yen we are up +10 bps at ¥110.7. Against the euro we are unchanged at 60.5 euro cents.
The bitcoin price starts today at US$68,268 and down -4.3% from this time yesterday. Volatility over the past 24 hours has been moderate at just on +/- 2.5%.
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