US takes bid for more sanctions against North Korea to Security Council; China cracks down on cryptocurrencies; Lending to HNA and Dalian Wanda Group under the spotlight; UST 10yr yield at 2.17%; oil and gold up; NZ$1 = 71.7 US¢, TWI-5 = 73.9

Here’s my wrap of what’s happened around the world overnight.

North Korea is “begging for war”. This is what the US ambassador to the United Nations has told the Security Council, as North Korea is said to be preparing to launch another ballistic missile. Nikki Haley has urged the group to impose the strongest possible sanctions against North Korea. There’s agreement across the Security Council that diplomacy, not military action, is the way to go. Nonetheless, South Korea has still flexed its muscles, firing a number of test rockets.

Instability in North Korea has seen some investors retreat to safe havens, but movements in the markets have been tempered. This is also due to a public holiday in the US.

Investor confidence in Europe is high, despite recent stock market declines and the risk of a rapidly strengthening currency. Sentix’s measure of eurozone investor confidence rose at the start of September to a near 10-year high.

China has banned fundraising through thought the launch of token-based digital currencies. The move targets initial coin offerings (ICOs), which have fuelled the spike in cryptocurrency values. The announcement has seen the value of cryptocurrencies fall. Commentators believe global regulators are pushing back at ICOs as they struggle to understand their risks.   

Hong Kong’s de facto central bank is putting the lending to two of China’s massive conglomerates under the spotlight. The Hong Kong Monetary Authority has asked banks in the city for details of their loans to HNA and Dalian Wanda Group. Bloomberg’s sources say lenders are required to give the authority information on their lending, but scrutiny of these two giants has escalated in recent weeks.

The move comes as Chinese regulators also step up scrutiny of the companies behind last year’s unprecedented spree of takeovers outside the country. HNA bought UDC Finance from ANZ earlier in the year.

In New York, the UST 10yr yield remains at 2.17%.

The price of crude oil is unchanged from yesterday at US$47 a barrel, while the Brent benchmark is down slightly to US$52.

Gold has jumped to US$1,333/oz.

The New Zealand dollar has strengthened, but remains weak. It’s at 71.7 US cents, 90.2 Australian cents and 60.2 euro cents. The TWI-5 index is up to 73.9.

If you want to catch up with all the changes from yesterday, we have an update here.

The easiest place to stay up with event risk today is by following our Economic Calendar here ».

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