What will Jay say?

<p>Kia ora, </p><p>Welcome to Thursday's Economy Watch where we follow the economic events and trends that affect New Zealand.</p><p>I'm David Chaston and this is the International edition from Interest.co.nz.</p><p>Today we lead with news we are in to the final ten days before the US Labor Day holiday and most northern hemisphere participants are taking vacations ahead of what could be an active and volatile economic period through to the end of year holiday season.</p><p>Yesterday, wholesale interest rates started to rise again in New Zealand. That was just a pre-cursor for the international bond market overnight where the benchmark UST 10yr yield jumped back to 1.35% despite some weak economic data.</p><p>Part of the reason for the turn up is the US Fed's focus on the Jackson Hole meeting and the signals Fed boss Powell will be giving. Markets suspect he will acknowledge that the current inflation impulse is likely to be less transitory and have longer term implications.</p><p>In the US, <a href="https://www.census.gov/manufacturing/m3/adv/pdf/durgd.pdf" target="_blank"><strong>new orders for manufactured durable goods</strong></a> in July decreased slightly although the fall was less than expected. But non-defence capital goods orders fell quite sharply although that was from an unusually strong June. Aircraft orders were especially weak. From the same 2019 month these capital goods orders were -8% lower, so that is a poor result. It is not clear however how much the logistics supply chain constraints are having on these results.</p><p>US <a href="https://www.mba.org/2021-press-releases/august/mortgage-applications-increase-in-latest-mba-weekly-survey-x284144" target="_blank"><strong>mortgage applications rose</strong></a> last week but not in a significant way, continuing its yoyoing trend around zero for the past year. US <a href="http://www.freddiemac.com/pmms/" target="_blank"><strong>mortgage interest rates</strong></a> didn't move significantly either.</p><p>However, the yield on the overnight <a href="