Here are the key things you need to know before you leave work today (or if you already work from home, before you shutdown your laptop).
MORTGAGE RATE CHANGES
Late yesterday ANZ raised rates on some of its most popular fixed home loan terms. Their one year rate is now 6.99% and 18 months 6.75%. But these just match some of their main rivals. HSBC has withdrawn all fixed rate home loan rates other than their 6 month rate (7.09%). The variable rate is unchanged.
TERM DEPOSIT/SAVINGS RATE CHANGES
ANZ also added +20 bps to its Online Account and its Business Premium Call account, taking these rates to 2.75%. It's Cash PIE account has risen similarly. HSBC has withdrawn all their term deposit offers except those for 30 days, 60 days and 90 days.
HSBC RETRENCHING
HSBC today announced it will be quitting retail banking in New Zealand, winding down its wealth and personal banking business here (like mortgages and deposits). The Reserve Bank is reviewing its policy for branches of overseas banks, proposing that all branches of overseas banks operating in NZ be restricted to wholesale business with corporates, institutions and other wholesale investors, meaning they couldn't take retail deposits or offer products or services to retail customers.
HOUSE VALUES FALLING IN 13 OF 16 REGIONS STILL
Average dwelling values dropped another -$13,571 last month with values in Queenstown-Lakes falling more than -$18,000. Queenstown Lakes and Tauranga have experience the biggest falls in average dwelling values, according to QV data.
WORK VISA ARRIVALS BACK TO HIGHS
The number of people arriving in NZ on work visas is almost back to 2019 record levels. On average 17,656 people are arriving on work visas every month. This is work visa data from MBIE.
FEWER BUT LONGER
New Zealand-residents took fewer overseas trips, but for longer durations, in the April 2023 year compared with before the pandemic, according to data released by Stats NZ today. There were 1.99 million New Zealand-resident arrivals in the April 2023 year, which is two thirds of the 3.06 million who arrived back in the April 2019 year. New Zealand-resident travellers spent an average of 24 days abroad in the April 2023 year compared with an average of 19 days in the April 2019 year, they reported.
STILL FAST RISES, JUST NOT AS FAST
Local authority rates and regulatory income income rose +8.3% in 2022. But that growth slowed to +5.8% in Q1-2023, according to updated data from Stats NZ today.
MUSCLING UP
NIWA research for the Waikato District Council in the inner Hauraki Gulf shows that mussel farms can aid nitrogen removal, or denitrification. Obviously not having excess nitrogen in rivers is better, but where it does exist, mussel beds can play a role in minimising the damage.
STEADY
Consumer sentiment unexpectedly improved in Australia, according to the Westpac-Melbourne Institute Consumer Sentiment index. It was only a small improvement, but no change was expected.
NOT STEADY
Meanwhile NAB said their business sentiment survey was unexpectedly weaker in May. Business conditions continued to ease, they said, with notable declines across the trading, profitability, and employment. The fall in conditions now appears to be accelerating and it hasn't been positive since January. This Australian mood turn lower contrasts with a similar survey in Japan. They too have had their struggles, but are now reporting an upturn in business sentiment.
NOT FALLING
Separately, it has been reported that residential dwelling vales rose by AU$140 bln to AU$9.9 tln in the March 2023 quarter. There are now just over 11 mln dwellings in Australia, now worth on average AU$896,000. That is a gain of +1% for the quarter.
AN UNEXPECTED CUT
China’s central bank unexpectedly cut its short-term policy interest rate, easing its monetary stance to help aid their economy’s faltering recovery. The the seven-day reverse repurchase rate was cut by -10 basis points to 1.9% and this was the first reduction in the rate since August 2022. The yuan fell. Benchmark bond yields fell. This sudden action comes just days after the central bank pleaded for patience. Data out later this week is expected to point out growing economic weakness.
SWAP RATES UNCHANGED
Wholesale swap rates are likely little-changed today although on the soft side. However, the real action in swap rates comes near the close. Our chart will record the final positions. The 90 day bank bill rate is up +1 bp at 5.69% and +19 bps above the 5.50% OCR. The Australian 10 year bond yield is down -6 bps at 3.90%. The China 10 year bond rate is down -3 bps at 2.67% and an 8 month low. And the NZ Government 10 year bond rate is at 4.53%, and down -3 bps, but that is still higher than the earlier RBNZ fix which is up +2 bps to 4.51%. The UST 10 year yield is now at 3.72% and up +3 bps from this time yesterday.
EQUITIES MIXED BUT WALL STREET & TOKYO STRONG
Wall Street ended today's session with a bit of a flourish, with the S&P500 ending its Monday session up +0.9%. Tokyo has opened its Tuesday session up a stronger +1.5%. However, Hong Kong has opened down -0.3%. Shanghai is -0.2% lower in its opening Tuesday session. The ASX200 is back today after their holiday and is little changed in its afternoon session. The NZX50 has recovered +0.4% in late trade after yesterday's -0.6% fall.
GOLD ON HOLD
In early Asian trade, gold is at US$1957/oz and up +US$2 from where we were this morning. Earlier, gold closed in New York at $US1958/oz and in London at US$1953/oz.
NZD LITTLE-CHANGED
The Kiwi dollar is unchanged from this time yesterday at 61.2 USc. Against the Aussie we are little-changed at 90.7 AUc. Against the euro we are softish at 56.8 euro cents. That means the TWI-5 is still at 69.4.
BITCOIN LITTLE-CHANGED AGAIN
The bitcoin price is little-changed again today at US$25,960 which is up a mere +0.3% from this time yesterday. Volatility has again been low at +/- 0.9%.
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51 Comments
While the US sharemarket is on the rise and investors are 'Risk On' there is popularity with currencies like NZD.
If/when the current bullishness reverses in US equities and we go 'Risk Off', I'm expecting the NZD to fall below 0.60 again.
Could be wrong and not financial advice!
Stuff is running a vote. Do you agree with Chris Luxon that New Zealand is a whiny country?
27,000 votes so far and counting. 62% agree with Chris.
https://i.stuff.co.nz/national/300903899/yeah-nah-is-nz-a-negative-wet-…
If we're using interest.co.nz as a gauge:
Number of people constantly complaining about having to sell a rental: 0
Number of people constantly complaining about landlording: pick a number
In fairness people are going to complain about having to sell a rental, as much as people are going to tell you they lost playing pokies or buying crypto or peak GameStop in 2021.
Some people might get a hiding but the best ones will learn from it.
In fairness people are going to complain about having to sell a rental, as much as people are going to tell you they lost playing pokies or buying crypto or peak GameStop in 2021.
I'm down 85% on an altcoin. Doesn't concern me. 0.4% of a portfolio. And mentally prepared for it to go to zero.
The strange hypocrisy about having a whine about how whiny other people are.
From the scribes:
"Why do you see the speck that is in your brother's eye, but do not notice the log that is in your own eye? Or how can you say to your brother, ‘Let me take the speck out of your eye,’ when there is the log in your own eye? You hypocrite, first take the log out of your own eye, and then you will see clearly to take the speck out of your brother's eye?"
Matthew 7:3-5
And yet my friend from Colombia (yes really) laughs at the Kiwis who complain. His take is that life is so good here that people complain about stuff that really doesn't matter. I think there are so real struggles for people currently, but I also understand his take. This is a man who lived Pablo Escobar's territory, with all that came with that. I was joking about the Colombian hippos and he was so triggered by that. He literally said that it was about survival, he couldn't be with his good looking sister, walking down the streets, because one of the gang could shoot him to get her. Classmates trafficking drugs because it paid so well, who are now dead. He took the poverty route and became and engineer. I know NZ isn't perfect, but really, I think people who say we are the third world haven't left the country.
We have a lot to be grateful for. I'm grateful to still be alive after a cancer diagnosis and the superb, free care I received. It doesn't guarantee my survival but I'm in with a chance. If the toughest thing you have to face is selling a rental, but you still have your own home, then life has been good to you. Everything is relative. A little bit of gratitude goes a long way, it doesn't mean things aren't shit sometimes. Nothing and nowhere is perfect. Rant over.
Continued huge demand for Tbills even as Treasury ramps up sale volumes. But what's going on w/prices? Auction results show HIGH yield for 3m bills of just 5.15%. Yet, Treasury also says secondary mkt priced to yield 5.40%. Link
Same thing w/today's 6-month bill auction. Low yield well below RRP. High yield only 5.155%, yet Treasury also claims secondary market rate today was 5.38%. Not even close. Link
Luxon - yet another hypocrite: https://www.nzherald.co.nz/nz/politics/tesla-recoil-christopher-luxon-o…
On rereading I would say you are correct,Ardern's restriction only applied to Labour .
I remember Jeanette Fitzsimons telling us a story, of how she insisted they gave her the cheapest smallest car, and she had to drive across the swamp one night,when the aircon and wipers failed in a fog.
Yeah I'm confused too. The article was poorly written, and I'm struggling to understand if he:
a) spoke against the subsidy that private individuals can receive and then proceeded to order a Muskmobile for his own personal benefit (his own private vehicle that has nothing to do with 'perks of the job')
b) spoke against the subsidy that private individuals can receive but ordered and then cancelled the order for a Tesla that was meant to be some entitlement of the position. If so, how was he able to order a Tesla if it's not on the list? If he can only pick an EV and the Tesla was somehow an option, then I don't see this as any more of a deal than an MP who talks about inequality using the Air NZ lounge or flying business class if they are entitled to it. The issue then becomes one of whether MPs should actually receive such a perk at all.
Scenario a) would be unforgivably stupid, scenario b) is no big deal from my perspective. Maybe a bit shoddy from the optics perspective, but I personally couldn't care less.
He could have chosen a smaller cheaper EV like Jacinda made her people do, but unfortunately he thinks he's too important for that.
The issue is the lack of political instinct. He really is a terrible politician. This should be an open goal for National, he tripping and swinging wildly. He might managed to score but it will be through lick rather than talent or ability.
People had a go at me for buying a new car just over 2.5 years ago. ‘You are stupid to buy new, it depreciates by 20% the moment you drive it out of the showroom’ blah blah blah.
Well the car today on the used car market is not higher in value, but it’s only about 10% less. We have nearly paid off the loan (0% interest) and are likely to get many years of good use out of it, with likely minimal maintenance over at least the next few years.
Conventional wisdom ey?
Just like the conventional wisdom that said I was silly to change my Kiwisaver scheme to a cash scheme about 2 years ago.
I've done alright buying a new car in the past couple of years as well. Bought something Japanese and reliable that has hardly depreciated at all (according to the dealer based on what they would buy it back from me for) and have had all my maintenance costs covered, far lower fuel consumption than my last daily driver, and enjoyed driving it too.
However, at the same time I can see already some big price cuts on some higher end motors that depreciate badly. I've got a couple of Audis, BMWs etc on my Trademe watchlist (all 'nice to have' dream cars before driving a twin turbo V8 is faced with capital punishment) and they just aren't moving.
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