Here's our summary of key economic events overnight that affect Australia with news the breakdown of free passage in the Strait of Hormuz seems to have others considering the possibilities. Even if it isn't a formal idea, an Indonesian minister has wondered out loud about tolling the Malacca Strait.
And there is no indication of progress on re-opening the Strait of Hormuz. It is still a deadly no-go zone with no end in sight. Only bad news from the Persian Gulf.
In the US, actual initial jobless claims fell last week by -9,700 from the prior week. But this was less than the -16,000 seasonal factors would have expected. There are now 1,863,000 people on these benefits, less than the 1,880,000 a year ago but more than the 1,780,000 two years ago.
There was positive news from the US 'flash' PMIs for April. The factory version is expanding faster and is at a four year high. Their services sector is expanding again in a modest way after the March contraction.
But the April factory survey by the Kansas City Fed reported no improvement from the modest expansion in March.
However, the Chicago Fed's National Activity Index was notably lower in its latest update, reporting its biggest drop of the year.
And if you are working for the "Magnificent7" you may struggle to hold on to your job in the face of some severe downsizing. Meta has announced -10% or 8000 job cuts and said its 6000 open positions would be cancelled. And Microsoft is starting to shrink its large workforce by -7%. "AI productivity" is behind these moves.
Canada said its PPI rose sharply in March, up +7.8% from the same month in 2025, driven by very high metals price increases which were up an eye-watering +23.6% on that same annual basis.
In India, their April 'flash' PMIs reported a fast expansion that actually accelerated in the month, both for services and factories.
In Taiwan, and given earlier data on new orders, it will probably be no surprise to know that their industrial production was up +29% from a year ago, the fastest jump on record there. Their retail sales grew too, a turnaround from prior flat results, but nothing like in their factory sector.
There were 'flash' April PMIs out in Japan yesterday and their factory sector is strengthening (54.9 and a four year high) while their services sector's expansion cooled somewhat (51.2). This report also noted intensified cost pressures.
South Korea reported its Q1-2025 GDP rise at +3.6% from the equivalent 2025 quarter. This was the fastest growth since the fourth quarter of 2021 and exceeded forecasts of +2.7%.
In Europe, their factory sector is doing it tough in April. Eurozone output fell for first time in 16 months as prices surged higher.
Here in Australia, the S&P Global PMI tracking shows the economy expanding again in April after the surprise March contraction. The factory PMI is back expanding at a modest pace (51.0) while their services sector is back at a steady state (50.3) after the notable March contraction. They noted rising cost pressures however.
Global container freight rates were essentially flat over the past week, with trans-Pacific rates rising but China-EU rates falling. These are now little-changed from a year ago too, up a minor +3% on that annual basis. But bulk cargo rates rose a sharpish +11% over the past week to be +110% higher than year ago levels.
The UST 10yr yield is now just on 4.33%, up +4 bps from this time yesterday. The key 2-10 yield curve is now at +49 bps (-1 bp). Their 1-5 curve is at +27 bps (+4 bps) and the 3 mth-10yr curve is at +70 bps (+5 bps). The China 10 year bond rate is now at 1.74%, up +1 bp. The Japanese 10 year bond yield is up +3 bps at 2.43%. The Australian 10 year bond yield starts today at 4.99%, also up +3 bps from yesterday.
Wall Street has ended its Thursday trade with the S&P500 back down -0.4% and essentially cancelling yesterday's relief rally. Overnight, European markets were mixed, down between London's -0.2% and Frankfurt's +0.9% gain. And yesterday Tokyo closed down -0.7%, Hong Kong fell -0.9%, and Shanghai eased -0.3%. Singapore ended -1.2% lower in a big move for them. The ASX200 closed down -0.6%.
The price of gold will start today down -US$54 at US$4682/oz. Silver is down -US$2 at just under US$76/oz.
American oil prices are up +US$4at just on US$96.50/bbl, while the international Brent price is also up +US$4, and now at US$105.50/bbl and back in the range it was during the second half of March.
The Australian dollar is down -30 bps from yesterday at this time at 71.3 USc. Against the Japanese yen we are down -10 bps at ¥113.9. Against the euro we are also down -10 bps at just on 61 euro cents.
The bitcoin price starts today at US$77,590 and down -1.8% from this time yesterday. Volatility over the past 24 hours has been modest at just under +/- 1.5%.
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