US data modest but with heavy inflation signals; Canada PMI's stall; other main global PMIs upbeat; Albanese warns of difficulties ahead; UST 10yr at 4.31%; gold up and oil eases; AU$1 =69.3 USc

Here's our summary of key economic events overnight that affect Australia with news Trump is about to make a national address (7pm AEST) where he is expected to claim Iran wants a ceasefire (which Iran immediately said was false). Many expect he will pull the US out of NATO as well (although Congress would have to agree for that to be effective). Despite the unhinged nature of it all, markets cheered the likely end of the pointless war he started.

Separately, on Saturday we will get the March US non-farm payrolls data which is expected to show a +60,000 gain. The ADP version of private sector employment was out today for March and that showed a similar modest rise (+62,000).

But we should also note that February official data for private sector hiring revealed a record low rate.

US mortgage applications fell sharply again last week, down a further -10.5% for a third consecutive big drop, which is unprecedented. Refi fell the hardest but new purchase activity was down sharply too. Rising interest rates continue there.

The widely-watched ISM factory PMI was little-changed in March from February with the same modest expansion recorded, as signaled in the alternate globally-benchmarked S&PGlobal version. The New Orders Index indicated slower growth compared to the previous month with new export orders actually in contraction. Both observed soaring inflationary pressures, back to pandemic levels.

US retail sales rose in February by +3.7% above the year-ago level. This month car sales led the increase. That is a real gain given that February CPI inflation ran at 2.4%.

In Canada their March factory PMI shows no growth, no decline.

The China S&P Global PMI expanded again, showing growth of output and new orders were maintained in March. But suppliers' delivery times lengthen the most since December 2022. And they also recorded their strongest inflationary pressures, since March 2022. Again, their PMI was slightly more upbeat than the official version.

Japan, Taiwan and Malaysia all recorded modest to good factory expansions in March in their respective factory PMIs, and all recorded higher inflation pressures.

Interestingly, the Bank of Japan's Tankan survey of businesses there for Q1-2026 shows little negative impact from the current geopolitical situation. Those firms surveyed remain quite upbeat.

In Europe, their eurozone factory PMI also expanded, and at a 45-month high. But the inflationary pressures were also very evident in their report.

Here in Australia, yesterday's national address by Prime Minister Albanese warned of a rocky road ahead due to their fuel crisis, and that urgent reforms are required, mainly because previous deregulation has left them uncomfortably vulnerable in this situation.

Separately, their main business trade association said their Industry Index fell 19.9 points in March to -23.6, the steepest monthly decline since the initial pandemic phase of early 2020. Industrial activity, employment, new orders and sales indicators all fell markedly in response to the emerging energy crisis. Uncertainty was the main factor, with 30% reporting volatility in fuel prices, freight and/or supply arrangements because of the energy crisis. More than a quarter (26%) of businesses said rising costs were a major pressure – in fuel, freight, raw materials, resins, plastics and packaging.

There was a surge in residential consents issued in Australia in February, with 19,022 issued. That is the most for any month since mid-2021. Of note is the rise in Victoria where over 6000 consents were issued. That compares to NSW's 4332 and Queensland's 3890 in February. It is notable that states with relatively lower new-build consenting are those with higher rises in house prices.

The UST 10yr yield is now just on 4.31%, unchanged from yesterday. The key 2-10 yield curve is marginally steeper at +51 bps (+1 bp). Their 1-5 curve is up +2 bps at +27 bps and the 3 mth-10yr curve is now steeper at +61 bps (+2 bps). The China 10 year bond rate is up +1 bp at 1.82%. The Japanese 10 year bond yield is down -3 bps at 2.32%. The Australian 10 year bond yield starts today at 4.95%, little-changed from yesterday. 

Wall Street started its Wednesday with the S&P500 up +0.6% but fading. Overnight European markets all rose between London's +1.9% and Frankfurt's +2.7%. Yesterday Tokyo closed its Wednesday session up +5.2%. Hong Kong was up +2.0% and Shanghai rose 1.5%. Singapore jumped +1.8%. The ASX200 ended its Wednesday up +2.2%. 

The price of gold will start today up +US$142 from yesterday, now at US$4783/oz. Silver is up +US$1.50 to US$76/oz.

American oil prices are down -US$1.50 at just on US$100/bbl, while the international Brent price is down -US$2.50 at just under US$102/bbl. Ship transit traffic in the Strait of Hormuz seem to be slowly returning, but on Iran's terms.

The Australian dollar is -30 bps softer against the USD from yesterday, now at 69.3 USc. Against the Japanese yen we are up +40 bps to ¥110. Against the euro we are up +10 bps at just on 59.9 euro cents.

The bitcoin price starts today at US$68,837 and up +1.8% from this time yesterday. Volatility over the past 24 hours has been moderate at just under +/- 1.5%.