Business
Kia ora, Welcome to Thursday's Economy Watch where we follow the economic events and trends that affect New Zealand.I'm David Chaston and this is the International edition from Interest.co.nz.Today we lead with news of a broad range of August data that shows the Chinese economy is slowing, and quite quickly.But first in the US, industrial production rose as expected in August, up +5.9% from a year agoAnd the latest Fed survey of factories in the New York region shows that growth as picked up, selling prices are still setting new record high levels, and these businesses have a very positive outlook.In Canada, their CPI increased +4.1% in August and higher than the higher estimates. It is high enough now to become an election issue there.In China, house prices rose +4.2% in August which was a little less than the July rise and probably on a track they want to see. But most of the other August data they released was weaker than they would like.Chinese industrial production rose +5.3% year-on-year, well shy of July's +6.4% gain and the expected +5.8% in August. In fact the August gain was their slowest in more than a year.Their electricity production came in virtually unchanged from August a year ago.China retail sales underwhelmed even more, up just +2.0% when a +7.0% gain was expected because July rose +8.5%. So this is hard evidence their domestic economy is slowing fast.China seems to be blaming the weather for these shortfalls.They aren't the only Asian economy slowing. Data for Japanese machinery orders underwhelmed, although this is for July and seasonally-adjusted. The actual data was really quite positive and there is subsequent other data that suggests an August pickup.The EU released industrial production data for July too, and that came in better than expected (+7.7%) although not quite the rebound recorded in June.A new data point we should keep an eye on is the lithium price. It has been rising very strongly in 2021, but there is recent evidence that a mining supply-access frenzy is getting underway, especially in Australia and Canada.In Australia, there was an OECD review of its economy and it had some pointed criticisms embedded in their glossy assessments, not the least of which were aimed at the RBA and its policymaking.The UST 10yr yield opens today at just over 1.30%, so recovering +2 bps from this time yesterday. The price of gold has fallen -US$15 today and now at US$1792/oz.But oil prices have risen sharply overnight by about +US$2.50/bbl so in the US they are now still just under US$72.50/bbl, while the international Brent price is now over US$75/bbl.The Kiwi dollar opens today at just on 71.1 USc and marginally firmer since this time yesterday. Against the Australian dollar we are unchanged at 96.9 AUc. Against the euro we are firmish at 60.2 euro cents. That means our TWI-5 starts today still at just on 74.1 and we are still right at the top of the 72-74 range of the past ten months.The bitcoin price has risen again today, now at US$48,067 and +3.2% higher than this time yesterday. Volatility in the past 24 hours has been moderate at just over +/- 2.3%.You can find links to the articles mentioned today in our show notes.And get more news affecting the economy in New Zealand from interest.co.nz.Kia ora. I'm David Chaston and we’ll do this again tomorrow.