US data mixed; Canada enjoys a travel boost; China exports jump; Aussie confidence mixed; UST 10yr at 4.14%; gold rises and oil falls; Straits of Hormuz still closed; AU$1 = 71.5 USc

Here's our summary of key economic events overnight that affect Australia with news markets are betting Trump will 'declare victory' over Iran soon and walk back his war.

But the Straits of Hormuz are still effectively closed - to all but Iranian-linked vessels. Perhaps oddly, markets are assuming they will open to all 'soon'. The betting on TACO is strong.

But separately today in the US, the ADP weekly jobs report rose +15,500, the same as the prior week, a steadying after five weeks of modest gains.

Existing US home sales rose marginally in February but that was better than expectations that they would fall. That leaves them -1.4% lower than year-ago levels. Despite the recent rebound, unsold inventory rose at a sharper rate.

The NFIB Small Business Optimism Index fell for a second consecutive month in February when it was expected to rise (marginally). The net percent of owners expecting higher real sales volumes fell 8 points to a net 8%.

Today's UST 3yr bond auction brough another modest rise in yields from the prior equivalent event.

In Canada, their travel to the US is down more than -30% in February compared to the pre-tariff period, replaced by much higher travelling to other places. Interestingly, visits by American to Canada are rising. Canada is also attracting notably more tourists from other countries too, presumably those avoiding the US.

In Japan, machine tool orders remained especially strong in February, especially export orders.

China's exports rose almost +22% in February from the same month a year ago, its best rise since the pandemic. Imports were up almost +20%. Their exports to Australia rose +32% while their imports were up +29%. Their February trade with the US was even stronger with exports up +27% and imports up +36%.

In Malaysia, January industrial production expanded by +5.9% from a year ago, beating market estimates of a +5.4% rise and the previous month’s +4.8% increase. Their factory sector posted even stronger rises.

Here in Australia, the Westpac-MI consumer sentiment survey showed consumers remain firmly pessimistic, although sentiment continues to show some resilience. Daily responses in their survey show a material weakening over the survey week. The results were less pessimism on current finances and attitudes towards major purchases. On the economy it reveals more unease near-term but less concern about the medium-term. Unemployment expectations pushed up above long-run average levels, led by the over-45s.

Staying in Australia, the NAB business confidence survey found that business conditions were steady in February, but sentiment slipped, with confidence now in negative territory for the first time in almost a year, likely reflecting some caution in the ​wake of the February RBA rate hike. This survey didn't really pick up the more recent Middle East war effects because it was conducted from February ⁠23 ​to March 2 and so only ​caught the very beginning of the US-Israeli attack on Iran and subsequent spike ​in energy prices.

The UST 10yr yield is now just on 4.14%, up +2 bps from yesterday. The key 2-10 yield curve is steeper at +56 bps (+2 bps). Their 1-5 curve is unchanged +15 bps and the 3 mth-10yr curve is now at just on +42 bps (+1 bp). The China 10 year bond rate is also unchanged at just on 1.81%. The Japanese 10 year bond yield is holding at 2.19%. The Australian 10 year bond yield starts today at 4.85%, down -3 bps from yesterday.

On Wall Street, the S&P500 is little-changed so far. Overnight European markets were higher between Frankfurt's +2.2% and Paris's +1.7%. Yesterday Tokyo partially recovered by +2.9%. Hong Kong was up +2.2% and Shanghai was up +0.6%. Singapore recovered +2.2%. And the ASX200 rose +1.1%.

The price of gold will start today up +US$126 from yesterday at US$5229/oz. Silver is up +US$5 at US$89.50/oz today.

American oil prices are down -US$9.50, at just under US$84.50/bbl, while the international Brent price is down -US$10.50 to be now just on US$88.50/bbl.

The Australian dollar is up +30 bps against the USD from yesterday, now just on 71.5 USc. But against the Japanese yen we are up a sharp +130 bps at ¥112.7. Against the euro we are up +40 bps at 61.4 euro cents. 

The bitcoin price starts today at US$71,226 and up another +3.1% from this time yesterday. Volatility over the past 24 hours has been moderate at just on +/- 2.4%.