Uncertainty sends commodities to crazy levels

<p>Kia ora,</p><p>Welcome to Thursday’s Economy Watch where we follow the economic events and trends that affect Aotearoa/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 'events' are compounding to push commodity prices to unprecedented levels. At the same time, investors found their risk appetite again.</p><p>In Ukraine, the Russian army is <a href="https://www.nytimes.com/live/2022/03/02/world/ukraine-russia-war" target="_blank"><strong>still advancing on key population centers</strong></a> but none have fallen yet, which is <a href="https://www.wsj.com/articles/russia-resumes-kharkiv-bombardment-in-bid-to-break-ukrainian-resistance-11646208607" target="_blank"><strong>amazing</strong></a>. Russian troop losses are hard to know with any accuracy, but they seem to be about 2500 deaths per day (which interesting exceeds the total number of American lives lost over the whole 20 year Afghanistan war).</p><p>In Congressional <a href="https://www.federalreserve.gov/newsevents/testimony/powell20220302a.htm" target="_blank"><strong>testimony</strong></a>, the head of the Federal Reserve came out in support of a +25 bps rise at their meeting in mid March.</p><p>US <a href="https://www.mba.org/2022-press-releases/march/mortgage-applications-decrease-in-latest-mba-weekly-survey" target="_blank"><strong>mortgage applications</strong></a> fell again last week, and their key benchmark mortgage interest rates rose. Their benchmark 30year fixed is now 4.15% plus points.</p><p>The February non-farm payrolls report is due out on Saturday (NZT) and a gain of +400,000 jobs is anticipated which is slightly less than for January. Today we got the pre-cursor <a href="https://adpemploymentreport.com/2022/February/NER/docs/ADP-NATIONAL-EMPLOYMENT-REPORT-February2022-Final-Press-Release.pdf" target="_blank"><strong>ADP employment report</strong></a> and they revised up their January data and said the February gain was +475,000 new jobs. Gains were reported acr