Here's our summary of key economic events overnight that affect New Zealand, with news we are being reminded of the central role the giant Wall Street markets play in global finance.
It is a US holiday weekend, Memorial Day, and without those US markets operating, data releases and other market activity is very restrained.
But in the US, Fed boss Powell delivered a graduation speech that contained a spirited defense of those who run public services and the core role they play in a crisis. He clearly showed there are no libertarians in a recession or threat of one. They all want "the government" to cover their backs.
And the Trump Administration also shows the power of 'active' government policy setting. The using of tax policy to help your friends (and family) and punish your perceived enemies is on full display. And the use of tariffs to screw the scrum is a lever that also shows that clearly.
From his bully-pulpit, Trump has delayed a punitive tariff threat on EU goods to July 9. It was enough to depress the USD on the capricious uncertainty and the EUR as hit a one-month high.
We should note that American hot-rolled steel prices are now at US$900/tonne which is +29% higher than when Trumps tariff actions started to take shape at the start of 2025. These are policies that are embedding sharp producer price inflation there. And of course, they will rise from here, as tariff pressure builds on other efficient manufacturers outside the US.
You can contrast that with Chinese steel prices. We don't have hot-rolled coil steel prices for China to hand, but we do have rebar steel prices there and they are now US$425/tonne, down from US$460/tonne at the start of 2025, so a -7.5% decrease. A crude matching of the US and China steel price shifts suggests the Chinese-sourced products have gained a +35% advantage in the period, largely offsetting the tariff actions. It is American consumers paying for all this infantile policy-making.
Meanwhile, the world is getting on with business, but just with fewer data signals to start the week.
In Canada, factory sales there were weakish in April, the weakest month of the year so far. Key to the fall were declining output in both their oil industry, and their car manufacturing.
A recent review of the Canadian economy by the OECD suggests it will avoid recession, but that expansion will be hard to find in the present trade-war climate.
Meanwhile, the province of Alberta is feeling very uneasy. There is a fringe movement there to cede from Canada and become a US state, built on the feeling that federal Canada doesn't appreciate the economic role they play in the Federation. But that overlooks the central role the US is playing in depressing the oil demand and prices they claim is 'theirs'. Joining the US would only accentuate the feelings of 'victimisation'.
Across the Pacific, Singapore also released April factory production data and that rose faster from March, to be +5.9% higher than year-ago levels.
The UST 10yr yield is now at 4.51%, and unchanged from yesterday while the New York bond market was closed. The key 2-10 yield curve is still at +52 bps. Their 1-5 curve is still inverted at -6 bps. And their 3 mth-10yr curve still at +22 bps. The Australian 10 year bond yield starts today at 4.38% and down -7 bps from yesterday at this time. The China 10 year bond rate is up +2 bps at 1.69%.
Wall Street is closed for their holiday. But the futures market suggests the S&P500 will open tomorrow up +1.5% in a EU tariff-delay relief rally. Overnight, European markets were up with Frankfurt gaining +1.7% and Patis was up +1.2%. London was closed for its own holiday. Tokyo ended its Monday trade up +1.0%. But Hong Kong fell -1.4% and Shanghai ended unchanged. Singapore ended down -0.2%. The ASX200 was also unchanged at the end of Monday trade.
The price of gold will start today at US$3,340/oz, and down -US$17 from yesterday.
Oil prices are holding at just on US$61.50/bbl in the US and the international Brent price is still just under US$65/bbl.
The Aussie dollar is now at 64.9 USc, and down -40 bps from yesterday at this time. Against the Yen we are down -20 bps at just on ¥92.6. Against the euro we are down -20 bps at 57 euro cents.
The bitcoin price starts today at US$109,020 and up +1.6% from yesterday. Volatility over the past 24 hours has been modest at just on +/-1.4%.