Here’s our summary of key economic events overnight that affect New Zealand, with news a surge in Australian mortgage lending is bringing risks their regulators are moving to quash before it gets unsustainably risk.

But first in the US, the Chicago PMI rose in October from its worryingly low August and September levels, but it is still contracting and it has done so for 23 consecutive months now. This month’s slight improvement is on the back of a rise in new orders, modest as it may be. Basically this metric is just contracting slower now.

Japanese industrial production rose +3.4% in September from a year ago, a much better surge in the month than the +0.5% rise that was anticipated.

China’s official October PMIs have come in without any significant improvements from September. They say their factory PMI is now contracting marginally more and a noticeable step lower than last month, and their services PMI is barely expanding, when a small improvement was expected. (Over the past few months, these official measures have been more conservative that the private S&P Global versions. But we will have to wait and see if that is still the case in October.) (For reference, the NZ factory PMI is better than China’s, but our services PMI was contracting in September.)

The EU said its October inflation level is down to 2.1%, the expected dip from September’s 2.2%.

In Australia, there is more evidence inflation is embedding at levels well above 3%. Yesterday they released their Q3 PPI and that came in at 3.5%, unchanged from Q2, and up +1.0% for the latest quarter. Analysts had expected it to reduce.in Q3, but that isn’t happening. The RBA will be as unhappy with this as it was with the high CPI result.

And staying in Australia, bank lending grew +7.3% in September, up +6.3% for housing but up +9.5% for business from the same month a year ago. But there is a noticeable dip in business lending in September from August which surprised some. Going the other way, observers were equally surprised by the monthly surge in housing loans.

The surge is worrying APRA. The combination of demand from the FHB guarantee scheme, and exuberance by investors is combining to create the rush. And it is only expected to increase. So the regulator is stepping in with warnings to banks to reign in the party. High DTI lending is their special focus.

Globally, the OECD is reporting that foreign direct investment flows changed dramatically in the first half of 2025. For the whole period they were $663 bln, rising +18% in Q1, but tanking -38% in Q2. Over the whole period the US, Brazil and the UK were the top recipients of these flows.

The UST 10yr yield is now at 4.10%, unchanged from yesterday a this time A week ago it was at 4.00% and a month ago at 4.16%. The key 2-10 yield curve is now at +49 bps. Their 1-5 curve is still +1 bp positive and the 3 mth-10yr curve is now +11 bps positive. The China 10 year bond rate is unchanged at 1.75%. The Australian 10 year bond yield starts today at 4.32%, up +2 bps from yesterday. That is +16 bps higher than a week ago. The NZ Government 10 year bond rate starts today at just on 4.09%, down -2 bps from yesterday but up +7 bps for the week.

Wall Street is up +0.6% on the S&P500 from yesterday, up +0.3% for the week, but up +2.7% for the month. Overnight, European markets were all down -0.4, except Frankfurt fell -0.7%. Yesterday Tokyo ended up a very strong +2.1% which makes it up +5.0% for the week, up +17.6% for the month. Hong Kong fell -1.4% to be down -1.0% for the week, down -5.0% for the month. Shanghai fell -0.8% to be down -0.4% for the week, up +0.5% for the month. Singapore dipped -0.2% yesterday. The ASX200 was little-changed in Friday trade to be down -1.9% for the week, up +0.4% for the month. But the NZX50 was up +0.7% in its trade Friday, for a weekly +1.3% gain, and a +0.9% monthly rise.

The Fear & Greed index is still firmly in the ‘fear’ zone, unchanged from last week.

The price of gold will start today at US$4006/oz, up +US$7 from this time yesterday. That is down -US$102 from this time last week. But it is up +US$146 or +3.6% for the month.

American oil prices are little-changed from yesterday at just over US$60.50/bbl, with the international Brent price down -50 USc at on US$64.50/bbl.

The Kiwi dollar is now at just on 57.2 USc, and down another -30 bps from this time yesterday. It is also down -20 bps for the week, but down -70 bps or -1.2% for the month. Against the Aussie we are down -20 bps at 87.5 AUc. Against the euro we are little-changed at 49.7 euro cents. That all means our TWI-5 starts today at just under 61.8 and down -30 bps from yesterday, down -20 bps for the week, down -40 bps for the month.

The bitcoin price starts today at US$109,265 and up +1.1% from this time yesterday but down -1.2% from this time last week. But it is down -4.3% for the month (down -3.2% in NZD terms).. Volatility over the past 24 hours has been moderate at just on +/- 2.1%.

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