Economic stresses in China building

<p>Kia ora,</p><p>Welcome to Monday’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>And today we lead with news events in Russia are something of a gawkish sideline for us. It is China we should be watching.</p><p>But first this week, in the US the spotlight will be on the Fed's big bank stress test results out Thursday, NZT. There will also be data released on May personal income and spending, as well as the PCE price indexes. Additionally, we will be following durable goods orders this week, and among other things May's new and pending home sales.</p><p>Elsewhere, CPI inflation data for Canada, the EU, Germany, Italy, France, and Spain are all due. And in China, the official factory and services PMIs will be released on Friday, while locally we get both consumer and business confidence data, also on Friday.</p><p>In Western financial markets, <a href="https://edition.cnn.com/markets/fear-and-greed" target="_blank"><strong>Greed trumps Fear</strong></a> at the moment. Investors seem bullish, even if equity markets took a bit of a reversal last week.</p><p>Over the weekend in the US <a href="https://www.pmi.spglobal.com/Public/Home/PressRelease/6e8efbfbddde43f29eb12c5193939625" target="_blank"><strong>the first of their PMIs</strong></a> for June has become available and it told the tale of slowing growth, but a continuing expansion nonetheless. The factory sector is still contracting however and at a faster clip than in May. But their service sector is still expanding although that too is at a slower pace than for May even if it is still a good moderate expansion. New order growth eased, but was still the second-fastest in just over a year, while the pace of job creation slipped to its slowest since January.</p><p>Perhaps we should also note that China isn't the only place where commercial property is in trouble. The rise and rise of interest rates along with growing vacancy r