We are just going to have to live with the resulting chronic mess. And that probably means elevated inflation for much longer and all that brings with it – like supply chain disruptions and logistic twists.<\/p>\n
Stockpiling, itself an indication of economic inefficiency, is the current way the global economy is reacting, in turn an inflation enhancer.<\/p>\n
First today in the US, that stockpiling is showing up in their two May factory PMI reports. The S&P Global version<\/a> recorded output growth rose to its strongest level since April 2022 as buyers scramble to beat price rises and supply delays. Input costs rose at their fastest rate since mid-2022. Meanwhile the ISM version<\/a> reported very similar conditions, even if at a slightly lesser level.<\/p>\n In Canada<\/a>, their factory PMI version reported that growth was sustained in May as output, new orders and employment all rose. But like in the US, this is all trying to beat the cost pressures and supply chain challenges that are intensifying.<\/p>\n In Japan<\/a>, their May factory PMI remained unusually strong. But firms there signaled further strong increases in production with sales Input costs and selling prices rising at some of the steepest rates on record. Stock building efforts are still very much in evidence amid the ongoing and substantial supply chain disruptions.<\/p>\n In South Korea<\/a>, their factory upturn, already strong, gathered more pace amid stockpiling efforts. Output rises are their strongest in five years. Price pressures persist and remain near record highs. Meanwhile jobs growth is now at its highest since March 2013 as the outlook improves.<\/p>\n Meanwhile Korean exports<\/a> surged +53% from a year ago to a record US$88 bln for the month. (For perspective, New Zealand exports run at about US$6 bln per month average. Australia is about US$32 bln\/mth.) Their biggest increases were to China, although there were outsized export gains to the US. Their explosive growth is largely around their IT sector.<\/p>\n In Taiwan<\/a>, their factory output expanded at quickest rate since July 2021 in May. New orders continue to rise sharply. Firms report intense cost pressures here too, amid severe supply chain disruption. Stockpiling efforts are driving a quicker upturn in purchasing activity, they say.<\/p>\n In China<\/a>, their non-official S&P Global factory PMI was good, but nothing like their smaller neighbours. Growth rates for new orders and output remain good, although export orders fell. Input price inflation eased for first time in six months. They also have stockpiling effects as factories raised input stocks because supplier delivery times stretched out again.<\/p>\n Indian industrial production<\/a> stayed expanding in April and at a good rate, similar to what they have had since July 2025, and showing none of the slowdown analysts had been expecting to see in their data.<\/p>\n EU inflation expectations<\/a> as tracked by the broad ECB survey shows them unchanged at 4.0% in April. Analysts had expected them to rise to 4.3% but that didn’t eventuate.<\/p>\n The EU factory PMI<\/a> is still expanding but at quite a modest rate even as they have the same cost pressures everyone else is reporting.<\/p>\n In Australia, and in something of a surprise, the Melbourne Institute Monthly Inflation Gauge<\/a> recorded a -0.3% fall in May from April, after consecutive rises in the previous two months. The fall was primarily influenced by lower transport-related prices, attributable largely to fuel and the excise tax rollback. For the year to May this gauge reports inflation at 4.4%. The monthly cost of living also declined in May from April, particularly for self-funded retirees.<\/p>\n The updated Australian PMI<\/a> shows little real expansion with the steepest fall in new orders since last October being recorded for May. But prices are being pushed up all the same with selling price inflation at a 45-month high as sharp rises in input costs keep coming.<\/p>\n The UST 10yr yield<\/a> is now just on 4.47%, up +2 bps from this time yesterday. The key 2-10 yield curve is now at +42 bps (-2 bps). Their 1-5 curve is now at +37 bps (+1 bp) and the 3 mth-10yr curve is at +77 bps (+1 bp). The China 10 year bond rate is down -1 bp at just under 1.71%. The Japanese 10 year bond yield is up +2 bps at 2.68%. The Australian 10 year bond yield starts today at 4.90%, up +6 bps from yesterday. And the NZ Government 10 year bond rate is unchanged at 4.55%.<\/p>\n Wall Street has started its week ignoring the Middle East situation with the S&P500 up +0.4% and enough to claim another new record high. The Nasdaq is up +0.7%. Both markets consumed by the big tech IPOs underway. European markets were all lower to open their week, between Paris & Frankfurt’s -0.4% and London’s -0.7%. Yesterday Tokyo ended up +0.9%. That was mirrored by Hong Kong. Shanghai ended down -0.3% however, while Singapore was up +1.0%. The ASX200 ended unchanged. And of course the NZX50 didn’t trade for the holiday.<\/p>\n The price of gold<\/a> will start today down -US$48 at US$4491\/oz. Silver is up +50 USc at just under US$75.50\/oz.<\/p>\n Oil prices are up +US$4 just under US$91.50\/bbl in the US, while the international Brent price is now on US$94.50\/bbl and up +US$3.50. Oil had been starting to trade like Hormuz was open, but no more.<\/p>\n The Kiwi dollar is lower from yesterday at this time at 59.5 USc, down -50 bps. Against the Aussie we are also down -50 bps at 82.9 AUc. Against the euro we are down -30 bps at just under 51.1 euro cents. That all means our TWI-5 starts today at just over 62.9 which is down -40 bps from yesterday.<\/p>\n The bitcoin price starts today at US$71,684 and down -2.5% from this time yesterday. Volatility over the past 24 hours has been moderate at just under +\/- 2.5%.<\/p>\n Select chart tabs<\/p>\n US$
\n AU$
\n TWI-5
\n \u00a5en
\n \u00a5uan
\n \u20acuro
\n GBP
\n Bitcoin<\/p>\n
![](\"https:\/\/www.newsbeep.com\/nz\/wp-content\/uploads\/2026\/05\/soil-moisture-2026-05-13.gif\" "\\"click")
<\/a>\n<\/p>\n