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New Zealand Has NZ$433 Million Trade Deficit In July





New Zealand posted a merchandise trade deficit of NZ$433 million in July, Statistics New Zealand said on Wednesday - or 11 percent of exports.


The headline figure missed forecasts for a shortfall of NZ$325 million following the downwardly revised surplus of NZ$110 million in June (originally NZ$127 million).


Exports were worth NZ$3.96 billion, shy of expectations for NZ$4.07 billion and down from NZ$4.26 billion in the previous month.


Meat and edible offal led the fall in exports, down NZ$97 million (19 percent).


Milk powder fell NZ$118 million (23 percent) while the quantity rose 0.9 percent.


Fruit fell NZ$17 million (5.7 percent) while the quantity rose 3.9 percent.


Australia was the only top export destination to rise in value, up NZ$37 million.


"The meat export falls this month are partly due to record meat exports this time last year," international statistics senior manager Jason Attewell said. "Meat values in July 2015, off the back of a record high meat season, were 31 percent higher than the average value for the previous five July months."


Imports came in at NZ$4.40 billion versus forecasts for NZ$4.45 billion and up from NZ$4.13 billion a month earlier.


Intermediate goods led the fall in imports, down NZ$296 million (15 percent) due to crude oil.


Consumption goods fell in value for the first time in 23 months, down NZ$114 million (9.6 percent).


The only top import partner to rise in value was the United States, up NZ$83 million.


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Qantas Profit Soars to A$1.53 billion and Pays First Dividend





Qantas Airways Ltd.'s Chief Executive Officer Alan Joyce's turnaround program has produced a record annual profit as the airline has announced its first dividend since 2009 and has given bonuses to its 25,000 employees. According to a Wednesday filing, Australia's flag carrier airline is going to pay a final dividend of seven Australian cents per share and buy back almost A$366 million ($279 million) worth of stocks. During the 12 months that ended on June 30, earnings before tax and one-time items soared by 57 percent into A$1.53 billion.


The A$2 billion transformation program includes thousands of jobs that were cut, aircraft orders that were delayed and unprofitable routes which were pulled out. According to Joyce, the three-year plan is on the track to exceeding the initial target. Qantas has been doing well as shares have increased by 4.1 percent to A$3.54 with the stock nearly tripling ever since Joyce has announced the program. In the past year, Qantas has delivered two one-off capital returns which produces an overall of beyond A$1 billion.


The airline's domestic business underlying operating profit has jumped by 20 percent to A$578 million and has significantly surged by 92 percent with A$512 million on its international unit.


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Japan Producer Prices Jump 0.4% In July





Producer prices in Japan were up 0.4 percent on year in July, the Bank of Japan said on Thursday.


That beat expectations for an increase of 0.1 percent following the 0.2 percent gain in June.


On a monthly basis, process also jumped 0.4 percent following the flat reading in the previous month.


Among the individual components, prices increased for advertising, communications and leasing - while they were down for transportation and postal activities.


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Brazil Senate approves amendment of revenue appropriation





Brazil's Senate approved a constitutional amendment in which the government can readily use up to 30% of tax revenues which would have been allocated for other expenditures.


Called the DRU, this will help the Brazilian government ensure that their expenses is in check as it aims to curb its fiscal deficit in the future.


The legislation, which was passed faster than estimated, had voided in 2015 and will not be prolonged until 2023. President Michel Temer pledged to resolve the fiscal deficit in the country.


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Overall Japan Inflation Slides 0.4% In July





Consumer prices in Japan slipped 0.4 percent on year in July, the Ministry of Internal Affairs and Communications said on Friday - matching expectations and unchanged from June's annual reading.


Core CPI, which excludes volatile food costs, slid 0.5 percent on year - missing forecasts for -0.4 percent, which would have been unchanged.


Among the individual components, fuel costs were down 7.7 percent on year, followed by communications (-2.6 percent), furniture (-0.8 percent) and housing (-0.1 percent).


Clothing prices jumped an annual 2.4 percent, followed by education (1.6 percent), food (1.1 percent), medical care (0.9 percent) and recreation (0.8 percent).


On a monthly basis, overall inflation and core CPI both dipped 0.2 percent.


Among the individual components, clothing prices skidded 2.6 percent on month, followed by fuel and furniture (both -0.8 percent), and food and recreation (both -0.1 percent).


Communications and recreation costs gained 0.1 percent, while housing, education and medical care all were flat.


Overall inflation in Tokyo, considered a leading indicator for the nationwide trend, slipped 0.5 percent on year in August. That missed expectations for 0.4 percent, which would have been unchanged.


Core CPI in August was down an annual 0.4 percent - matching expectations and the same as in the previous month.


Among the individual components, fuel costs were down 9.7 percent on year, followed by communications (-1.4 percent), furniture (-1.9 percent) and housing (-0.5 percent).


Clothing prices jumped an annual 2.4 percent, followed by recreation (0.9 percent), education and medical care (both 0.8 percent) and food (0.4 percent).


On a monthly basis, both overall and core inflation advanced 0.1 percent.


Individually, recreation costs gained 1.7 percent on month, followed by communications (0.5 percent).


Fuel prices slid 1.5 percent, while clothing prices fell 1.2 percent and food dipped 0.2 percent.


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Italy Declares State of Emergency as Earthquake Death Toll Hits 250





Italy's government declared a state of emergency in the areas hit hardest by the massive earthquake on Wednesday. The 6.2 magnitude quake struck in the early hours of Wednesday in central Italy, severely damaging several towns.


At the minimum, 250 people have died from the disaster while 365 other people were injured. Rescue teams have continued to work through the rubble of destroyed buildings for a second night, but hopes of finding more survivors are dimming.


Prime Minister Matteo Renzi has pledged 42 million pounds in funds for rehabilitation of the affected areas. Aside from the funds, the Italian premier has scrapped taxes for locals in the disaster zones. He also announced a new measure called “Italian Homes” to address the criticism of the Italian media over poor-quality home construction, but he also stated that it was ridiculous to think that the nation could establish full quake-proof establishments.


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Australia Building Permits Surge 11.3% In July





The total number of building permits issued in Australia was up a seasonally adjusted 11.3 percent on month in July, the Australian Bureau of Statistics said on Tuesday - coming in at 20,987.


That beat forecasts for an increase of 1.1 percent following the 2.9 percent contraction in June.


On a yearly basis, building approvals climbed 3.1 percent versus expectations for a decline of 8.3 percent after slipping 5.9 percent in the previous month.


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U.S. Dollar Increases as Traders Expect Interest Rate Hike





The U.S. dollar has reached its highest level in three weeks which follows expectations regarding the Federal Reserve interest rate hike which could happen as soon as September. Traders are looking for indicators which show that the dollar may rise even further against the yen, euro and other emerging-market currencies.


The Wall Street Journal Dollar Index decreased by four percent in the year to date. According to U.S. Commodity Futures Trading Commission and Scotiabank data, bets regarding a stronger dollar was at $7.18 billion. Federal Reserve Chair Janet Yellen and Vice Chairman Stanley Fischer have both stated that the current economy was strong enough for an increase in the federal-funds in 2016. The comments drove the largest one-day rally in two months in the WSJ Dollar index.


According to CME Group data, most traders expect an increase of rates done only once in the following year while Fed-funds futures have shown that they only see a 30% chance of an increase twice by next July.


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Japan Industrial Production Unchanged In July





Industrial output in Japan was flat on month in July, the Ministry of Economy, Trade and Industry said on Wednesday.


That missed forecasts for an increase of 0.7 percent following the 2.3 percent jump in June.


On a yearly basis, industrial production fell 3.8 percent - also missing forecasts for a decline of 3.0 percent following the 1.5 percent drop in the previous month.


Upon the release of the data, the METI maintained its assessment of industrial production, saying that it continues to fluctuate indecisively but shows signs of increasing in parts.


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Dollar Climbs to One-Month High while Investors Weigh on Fed Rate Hike





The U.S. dollar increased to a one-month high against a basket of currencies while investors carry on by assessing the next increase in interest rates. The WSJ Dollar Index increased by 0.6 percent to 87.06 bound to its highest closing level since July 28.


The dollar increased by 1.1 percent against the Japanese yen to ¥103.05. The euro slipped by 0.4 percent to $1.1143. According to CME Group data, investors currently see a 27 percent likelihood of a Federal Reserve rate increase in September as well as a 55 percent likelihood in December. A gauge of U.S. consumer confidence during August increased to its highest level in almost a year as a different report has shown that consumer spending was also up for the fourth consecutive month in July.


The dollar was higher against emerging market-currencies. The dollar climbed against the Mexican peso by 0.8 percent and also increased against the South African rand by 0.6 percent.


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