US labour data upbeat but sentiment downbeat; China harvests; EU inflation in spotlight; Australia gets first trade deficit in nine years; mineral prices rise; UST 10yr at 4.46%; gold dips and oil rises; AU$1 = 71.8 USc

Here's our summary of key economic events overnight that affect Australia with news of a changing of the guard. Countries are moving away from US Treasuries as a core reserve asset, replacing it with gold. At the same time, crypto values including for bitcoin, seem to be fading fast.

But first up today in the US, they reported a surge in April job openings, their most in 18 months, notably in California and other western states. It is a services related thing, with manufacturing jobs not really participating.

Meanwhile, the US RCM/TIPP economic sentiment survey fell slightly in June from may, but to its lowest in two years.

And the US Logistics Managers Index is showing the full impacts of the current supply-chain disruptions and stockpiling. It held in May at its highest since the pandemic stress period. It is increasing at an increasing rate for inventory costs, warehousing capacity, and freight prices.

In China, we should note that it is wheat harvest season and that they expect a bumper result. At the same time, both Australian and US farmers are hesitating in their plans for wheat as high fertiliser and fuel costs threaten to make the prospects very uncertain.

In the EU and as expected, CPI inflation firmed up to 3.2% in May from 3.0% in April. Their core inflation rose as well. It seems to be only about rising fuel costs at present with the spread wider quite limited. Will the ECB hike its policy rate on June 11? Markets are betting 100% it will.

Here in Australia, we have slipped into our first trade deficit since 2017 in the March 2026 quarter. Exports of minerals fell (except for gold) while imports of data center equipment surged.

Globally, it is worth noting again that aluminium, zinc, copper and tin are all now either at record highs or at post-pandemic highs.

The UST 10yr yield is now just on 4.46%, down -1 bp from this time yesterday. The key 2-10 yield curve is now at +41 bps (-1 bp). Their 1-5 curve is now at +37 bps (unchanged) and the 3 mth-10yr curve is at +77 bps (also unchanged). The China 10 year bond rate is holding at just under 1.71%. The Japanese 10 year bond yield is down -11 bps at 2.57%. The Australian 10 year bond yield starts today at 4.92%, up +2 bps from yesterday.

Wall Street has hesitated today with the S&P500 up just +0.1% but still enough to claim another new record high. The Nasdaq is little-changed. European markets were between Paris's +0.8% and London's +0.3%. Yesterday Tokyo ended down -0.3%. Hong Kong however zooned up +2.5%. Shanghai ended up only +0.4% however, while Singapore was up another strong +1.2%. The ASX200 ended down -0.1%.

The price of gold will start today down -US$9 at US$4482/oz. Silver is down -50 USc at just over US$75/oz.

Interestingly, an ECB analysis released overnight has highlighted that after the run-up in the gold price, at the same time as the value of US Treasuries fell, gold was the largest single asset held for 'foreign reserves'. (see Chart 7)

Oil prices are up another +US$2 just under US$93.50/bbl in the US, while the international Brent price is now on US$96/bbl and up +US$1.50. Hormuz remains shut.

The Australian dollar is firmer from yesterday at this time at 71.8 USc, up +20 bps. Against the Japanese yen we are up +50 bps at ¥114.8. Against the euro we are up +20 bps at just under 61.7 euro cents.

The bitcoin price starts today at just on US$67,464 and down a sharp -5.9% from this time yesterday and falling. Crypto funds are getting excess redemptions at present. Volatility over the past 24 hours has been high at just under +/- 3.5%.