US producer prices ease; bond markets warn US Administration; Japan readies another rate hike; Aussie wage rises less than inflation; Hormuz shut; UST 10yr at 4.63%; gold down; oil prices dip; AU$1 = 70.6 USc

Here's our summary of key economic events overnight that affect Australia, with news ship traffic in the Hormuz Strait is now at a complete standstill. But oil prices have eased slightly all the same. So Wall Street rose and to new record highs.

In the US, there were +187,000 initial jobless claims last week, a slightly larger increase than seasonal factors can account for. There are now just over 1.8 mln on these benefits, a fall from last week as the very much tighter qualification requirements keep people off these unemployment programs.

US producer prices came in slightly lower than expected for July, up +4.7% from a year ago, down from +5.5% in June and lower than the +4.9% expected. A notable fall in July fuel costs offset all other rises in the month.

There was a well supported US Treasury 30 year bond auction earlier today, but investors wanted and got higher yields. They came in at a median 5.16% (high 5.22%) which is a 25 year high and something of a warning to the US Administration. This was up from the prior equivalent event median of 5.01% a month ago.

Meanwhile, Cleveland Fed President Hammack restated her view that the ‌US central bank should raise rates immediately to bring down too-high inflation and restrain business growth and investment. She is a current FOMC voting member. She said she "lacks confidence" the current do-nothing policy will get inflation back to its target. Meanwhile the Richmond Fed boss Barkin says he is happy to wait. Barkin is not a current FOMC voting member.

In Japan, their central bank wants to raise its 1% policy rate from here, and reports indicate that it has government backing for the move now. It could come at the next review in mid-September. Markets have priced in a 75% chance.

Japanese producer prices have been rising fast recently and were up 7.2% in July from a year ago. But there was essentially no rise in July from June, so they are starting to see some heat dissipate.

India reported strong exports, its third highest monthly total ever in July, and up +19% from the same month in 2026. But they also reported record high imports, driven by fuel imports.

In the EU, euro area industrial production rose in June, very slightly (+0.1%), when a fall (-0.8%) was expected. In the wider EU region, the gain was even better. Production of consumer goods led the way with a strong June result. Gains in Denmark, Poland and Finland were notable. Germany and France dipped.

Here in Australia, regulators are warning that online brokers are targeting retail investors with complex or high-risk products without clearly disclosing their risks or conducting proper onboarding, leaving those who respond exposed to risky products that could see them lose their investments within hours. Among the nine online brokers they reviewed are Sharesies, and Tiger Brokers.

New semi-annual pay data out here yesterday revealed a softening trend in the private sector. Overall average weekly ordinary time earnings for full-time adults were AU$2,084 in May, up just +1.6% overall in the period, up +3.7% for the year. These are the slowest increase rates since 2022. Rises in public sector pay are running at nearly twice the pace of the private sector. Recall, CPI inflation there was at 3.8% in the year to June - so no real gains.

Global container freight rates were up a mere +1% last week from the prior week but are +85% higher than year-ago levels. That weekly data masks sharply higher rates to the US from China, offset by lower rates from China to the EU. Bulk cargo rates fell -4.2% in the past week from a cycle high and are now +45% higher than year-ago levels.

The UST 10yr yield is now just on 4.63%, down -5 bps from this time yesterday. The 30 year yield is at 5.22% and down the same. The key 2-10 yield curve is now at +48 bps (unchanged). Their 1-5 curve is now at +36 bps (-1 bp) and the 3 mth-10yr curve is at +96 bps (-3 bps). The China 10 year bond rate is little-changed at 1.70%. The Japanese 10 year bond yield is now at 2.87%, up +3 bps. The Australian 10 year bond yield starts today at 4.96%, down -2 bps. The NZ Government 10 year bond rate is at 4.68%, and down -5 bps from yesterday at this time.

Wall Street is in positive territory today with the S&P500 up +0.7% and the Nasdaq up +1.0%. Overnight, European markets were all lower between London's -0.6% drop and Frankfurt's -0.1%. Yesterday Tokyo was up +1.2%. Hong Kong was down -0.2% and Shanghai fell -0.5%. Singapore ended unchanged. The ASX200 ended down -0.2% on Thursday. But the NZX50 rose +0.6%.

The price of gold is falling, now at US$4357/oz, down -US$60 from yesterday. Silver has fallen almost -US$1 to just over US$64.50/oz.

Oil prices are down -US$1 from yesterday at just under US$82/bbl in the US, while the international Brent price is now just under US$88/bbl. Hormuz transits have virtually vanished. There has been no crude tankers and only 1 cargo ship exiting over the past 24 hours (0 dark with transponders off) and just two entering for new loads (0 dark), again all Iran-linked. The Red Sea activity is now less than 10 exits at the Yemen chokepoint.

The Australian dollar is little-changed from yesterday at just under 706 USc. Against the Japanese yen we are also holding at ¥112.6. Against the euro we have dipped -10 bps to 61.2 euro cents.

The bitcoin price starts today at US$63,141 and down -0.4% from this time yesterday. Volatility over the past 24 hours has also been low at just on +/-0.8%.