1. The news that mattered this morning

A meth testing bombshell shook the real estate industry, a leaked MPI report uncovered under-reporting of almost 3,000 tonnes of Southern Blue Whiting fishing, Heather Simpson returned to the heart of the Government's reform plans, Donald Trump re-escalated his trade war with China and the Eurozone debt crisis returned with a vengeance overnight.

Up in smoke - The meth testing industry's reason for existence essentially evaporated yesterday when the Prime Minister's Chief Science Adviser, Peter Gluckman, published a report completely debunking the current standards that saw meth levels of less than 1.5 micrograms per square metre (0.0015 milligrams) prompting landlords and Housing New Zealand to kick out tenants and spend tens of millions of dollars on unnecessary mediation. He said exposure to contamination to levels below 15 micrograms was unlikely to cause health damage.

Housing Minister Phil Twyford released the report and announced 240 Housing New Zealand properties that had been emptied because of meth contamination fears would be occupied again. He announced public consultations later this year on new meth standards. Housing NZ CEO Andrew McKenzie announced Housing NZ would immediately move its trigger level for decontamination to above 15 micrograms.

The report shocked and angered the meth testing and real estate industries, who questioned the science behind the report and suggested it was politically motivated.

First National Real Estate chief executive Bob Brereton said there appeared to be no new research in the report and he called for compensation for home owners and real estate agents who had paid to remediate the houses.

"Given the Governments strong position on increasing housing stocks and the ministers immediate action to release a large quantity of houses previously deemed uninhabitable back into the system it’s difficult not to see a political motivation in this. Simply put, the government needs a win on social housing and has chosen to put the health of children at an unquantifiable risk in order to achieve it," he said.

Meth Solutions director Miles Stratford told RNZ : "Some of the most vocal people advocate on behalf of drug users. We advocate on behalf of hard-working New Zealanders," adding landlords were smarter than the chief science adviser and that health was not the only issue to consider around meth use.

H2 is back - Health Minister David Clark announced a wide ranging review of the health system to be led by Heather Simpson, the former right hand woman of Prime Minister Helen Clark. Widely known as H2 when working with Clark, Simpson will chair the review.

The review essentially is the titular review that wraps in other reviews of mental health and Maori health. See Thomas Coughlan's report on Newsroom Pro from yesterday for more.

Fishy tales - A leaked MPI report on the Southern Blue Whiting fishery found almost 3,000 tonnes went unreported because of poor practice when cutting fish. An MPI investigation in 2012 was done using port inspections and data from observers. There were no prosecutions, sparking fresh allegations from Greenpeace and others that MPI was a captured ministry.(Newshub)

Trade war back on - In a re-escalation of America's trade war with China, US President Donald Trump announced this morning that America would impose a 25 percent tariff on US$50 billion worth of technology imports from China and set limits on investments in the United States by Chinese citizens and entities. The move surprised many who expected Trump to hold back on new trade sanctions against China ahead of a possible summit with North Korea's Kim Jong Un on June 12, given Trump needs China to keep the pressure on North Korea.

Trump has been heavily criticised for trying to ease sanctions on China's ZTE. (Reuters)

Eurozone crisis back on - Italian bond yields jumped sharply overnight and bank stocks sank globally as international investors feared fresh Italian elections would turn into type of referendum on Italy staying in the euro zone. The two year Italian bond yield spiked to 2.8 percent from 0.9 percent, the biggest intra-day rise since records began in 1992 and more than during the Eurozone debt crises of 2010-12. The gap between Italian and German bond yields, which is a measure of fear within the Eurozone, has jumped to over 300 basis points from 100 basis points.

Investors fear Italy might default on its massive government debts if it elects to leave the euro, which would shatter Europe's banking system. Bank shares in Europe and America fell heavily. Italy's central bank Governor warned Italy was "a few short steps" from losing investor trust. The crisis broke after Italy's President refused to appoint a euro-sceptic finance minister recommended by a new Five Star-Northern League Government. Instead, he appointed a former IMF official as finance minister. ( Reuters )