Australia decides to not respond to its omicron surge

<p>Kia ora,</p><p>Welcome to Thursday’s holiday edition 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 Australia's official tolerant attitude to Omicron infections sees it about to sweep over its population.</p><p>But first in the US, their <a href="https://www.census.gov/econ/indicators/advance_report.pdf" target="_blank"><strong>merchandise trade deficit widened</strong></a> to a new record high of US$97.8 bln in November from a revised US$83.2 bln in October. Imports rose +4.7% reflecting the ongoing recovery in domestic demand due to rising wages and a fast-recovering economy. Meanwhile, exports were down -2.1%. Both wholesale and retail inventories are creeping higher, in response to the supply-chain difficulties that are just going away.</p><p>US <a href="https://www.nar.realtor/research-and-statistics/housing-statistics/pending-home-sales" target="_blank"><strong>pending home sales</strong></a> unexpectedly dipped. Contracts to buy US previously owned homes fell -2.2% in November from October when a +0.5% rise was expected. This follows a 7.5% surge in October, amid limited supply and high home prices.</p><p>In <a target="_blank"><strong>South Korea, business confidence rose in December</strong></a> and the outlook for January was also revised higher.</p><p>In Turkey, <a href="https://tradingeconomics.com/turkey/currency" target="_blank"><strong>their currency fell</strong></a> heavily again yesterday, down -6% on the day, just days after last week's Government rescue effort. It is now back to where it was at the start of December. They are battling +20% inflation, in part caused by the fast-retreat in their currency. The guarantees the Turkish government offered as part of that plan may have a very expensive downside. The yield on Turkey's 10 year government bond now exceeds 25%.</p><p>The WHO is <a href="WHO%20warns%20of%20a%20‘tsunami%20of%20cas