Global bond yields rise

Kia ora,Welcome to Friday’s Economy Watch where we follow the economic events and trends that affect Aotearoa/New Zealand.I'm David Chaston and this is the international edition from Interest.co.nz.And today we lead with news UST yields are now near a 16-year high on fears American interest rates will stay higher for longer. And EU bonds yields are moving up too. Higher interest rates will weigh on asset valuations, especially real estate and commercial real estate in particular.But first, new US jobless claims came in at 212,000 last week, less than the week before and lower than expected. There are now 1.8 mln people on these benefits, a +10,000 increase from the prior week.The US Conference Board leading economic index is still pointing to an upcoming decline in near-term American economic activity but the weight is very much less now, in the July survey out today.And the Philadelphia Fed's factory survey in its industrial heartland is pointing to a good pickup in new order levels. It was a sub-index that had been negative for 14 consecutive months, so it is a sharp turnaround. And it wasn't the only improving indicator.Across the Pacific, Japan's exports fell -0.3% in July from a year earlier, the first drop in more than two years, reflecting the slowing global economy including in key trade partner China.But Japanese machinery orders rose slightly in June.Today, all eyes will be on the release of Japan's July CPI. It was running at 3.3% in June and analysts expect the July increase to come in at about 2.5%.In China, their central bank is trying to force the value of the yuan up when it is under devaluation pressure. It's in a tough spot because it needs to cut local interest rates to support growth but that would normally depress its currency. But markets aren't buying the moves and have devalued the currency anyway despite the official fixing indication. The gap between the official rate and the market rate is now its widest in ten months. But without a better rate, the central bank will have to absorb some very chunky losses.In London and New York, China's major state-owned banks were seen selling US dollars to buy yuan in an attempt to slow the yuan's depreciation. Though they also trade on their own behalf or to execute clients' orders, state banks often act for the central bank when the yuan is under pressure, as it is now.And in China itself, investors who put money in a troubled shadow bank said police officers visited their homes and urged them to avoid public protests, the latest sign authorities are worried about unrest as fears grow of financial contagion.It is increasingly noticeable that the financial media in China are avoiding any coverage of their economic stresses. And because there isn't a lot of 'good news', their coverage of any economic news has become somewhat trivial.As expected the Philippines left its official policy interest rate unchanged at 6.25% in their reg