US hiring weakens; North American real estate markets generally soft; German sentiment undermined; RBA hikes; airlines see passenger demand doubling; UST 10yr at 4.20%; gold firms; oil steady; AU$1 = 71 USc

Here's our summary of key economic events overnight that affect Australia with news financial markets are relatively calm today mainly because the Persian Gulf situation has slipped into a stalemate with no new developments good or bad.

But first up today in the US, ADP weekly jobs report showed some weakness with just a +9000 gain nationally, far less than the expected gain and almost half what it has recorded over the past four weeks. They say there is a noticeable slowing in hiring.

Business activity continued to decline significantly in the New York region’s service sector in March, according to firms responding to the New York Fed’s Business Leaders Survey.

US pending home sales picked up marginally in February from January but are still -1.4% lower than year-ago levels. But there is wide variation, with the West (California) rising notably, the South and Mid West with minor gains, but the North East had notable declines.

In Canada, their real estate markets did it tough in February, from both the economic uncertainty and prolonged bad weather.

Elsewhere and as expected, the central bank of Indonesia held its policy rate at 4.75% where it has been since September 2025.

In Germany there has been a huge drop in confidence as recorded by the ZEW sentiment index, all related to Trump's war in the Middle East and the downstream consequences for Europe. But perhaps somewhat surprisingly though, the negative reading was very minor.

And as expected, the RBA raised its policy rate late yesterday by +25 bps to 4.1%. But what wasn't expected was how close the vote on the hike was. Five members voted for the rise, but four wanted to hold. In the end it was the growing risks of inflation that tipped the scale, made worse by the Middle East tensions and consequences. All the major banks have now announced pass-though rises to their variable rates.

Globally, it is also probably worth noting that the airline industry's forecasts show that air travel is expected to double by 2050. Obviously that assumes the current geopolitical tensions subside. They see an outsized share of the expansion will come from China.

The UST 10yr yield is now just on 4.20%, down -3 bps from yesterday at this time. The key 2-10 yield curve is holding at +54 bps. Their 1-5 curve is flatter at +15 bps (-4 bps) and the 3 mth-10yr curve is now at +50 bps (-3 bps). The China 10 year bond rate is little-changed at just over 1.83%. The Japanese 10 year bond yield is down -2 bps at 2.27%. The Australian 10 year bond yield starts today at 4.90%, down -6 bps from yesterday. 

Wall Street has started Tuesday trade with the S&P500 up +0.4% so far. Overnight, European markets were also up, between London's +0.8% and Paris's +0.4%. Yesterday, Tokyo closed down -0.1%. Hong Kong ended its Tuesday session up +0.1%, but Shanghai fell -0.9%. Singapore ended up a large +1.4%. 

The price of gold will start today up +US$17 from yesterday at US$5001/oz. Silver is down -US$1 at US$79.50/oz.

American oil prices are down -50 USc, at just on US$95/bbl, while the international Brent price is still just on US$102/bbl. The Straits of Hormuz remain no-go areas for most with the situation still extremely unstable. The ships transiting are those approved by Iran, which holds all the cards at present.

The Australian dollar has risen today, up +40 bps against the USD from yesterday, now just on 71 USc. Against the Japanese yen we are also up +40 bps at ¥112.9. Against the euro we are up +10 bps at 61.6 euro cents.

The bitcoin price starts today at US$74,160 and up +0.5% from this time yesterday. Volatility over the past 24 hours has been modest at just under +/- 1.8%.