A review of things you need to know before you sign off on Tuesday; no retail rate changes, interest-free car loans from Westpac, are rates really high?, swaps up, NZD holds, & more

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/LOAN RATE CHANGES
No changes to report today.

TERM DEPOSIT/SAVINGS RATE CHANGES
Nothing here either. But TSB reduced its minimum deposit for its online WebSaver account from $1000 to $1. It didn't change the rate however, at 4.20%

MORE CHOICES FOR WESTPAC HOME LOAN CLIENTS
Westpac have renamed their Warm Up loan to Greater Choices, and extended its coverage to now include electric cars (and their chargers), hybrids, and rainwater tanks. These Greater Choices loans are actually interest-free (0%) for up to five years, for up to $50,000. But they are only available to Westpac customers who have a home loan with them "who meets lending and affordability criteria".

SIGNIFICANT SHORTFALL SEEN BETWEEN LEVEL OF USERS' HOLDINGS & AMOUNT OF DIGITAL ASSETS HELD BY DASSET
Digital Asset Exchange, or Dasset, had digital assets of about $600,000 versus user liabilities of about $6.9 million, according to its first liquidator's report from Grant Thornton's Malcolm Moore. The digital asset exchange offered users the ability to buy and sell over 90 different digital assets with NZ dollars. Moore estimates Dasset had more than 5,000 registered users. Moore says Grant Thornton has been in contact with the Financial Markets Authority and the Serious Fraud Office. He also notes that, as a registered financial service provider, Dasset was required to provide access to a dispute services process. However, the Insurance and Financial Services Ombudsman (IFSO) says the company was removed from its scheme prior to liquidation because it hadn't responded to complaints raised by the IFSO.

MORE PARTY POLICY UPDATES
We have updated our policy comparison resource with new items from Top - Health on vaping, Top on Immigration, and National on Health (cancer drugs). The same link can take you to the Party Lists.

RESILIENT
Given all the challenges the country faces, within and from its northern neighbour, it is perhaps surprising that consumer sentiment is holding up very well in South Korea, better than analysts had expected. The results of their business sentiment survey will be released tomorrow.

US BANKS FEELING THE SQUEEZE FROM HIGHER RATES
In the US, S&P has followed Moody's in trimming the ratings of a set of regional banks. Many depositors have "shifted their funds into higher-interest-bearing accounts, increasing banks’ funding costs," S&P wrote in a note summarising the moves. "The decline in deposits has squeezed liquidity for many banks while the value of their securities, which make up a large part of their liquidity, has fallen." Federally insured banks were sitting on more than US$550 bln in unrealised losses on their available-for-sale and held-to-maturity securities as of mid-year, S&P said.

A LITTLE PERSPECTIVE
As you will note in the next item, the benchmark UST 10yr has risen sharply to a new 'recent high'. But we should keep in mind that this is still well below the long-run average for this rate, which over the past 60 years was 5.88%. From 1963 until the end of 1979 the average was 6.31%. From 1980 for the next 20 years it was 8.62%. For the subsequent ten years until the end of 2009 it was 4.46%. And for the 13 years since, it has averaged just 2.32%. Today's 4.34% is nothing special, despite all the current angst. (In fact, economic expansion was fastest when it was highest, although inflation was also a wicked problem during some of that period.)

SWAPS COULD BE HIGHER
Wholesale swap rates were probably up again today, but the real reaction will come at the close. To be fair, this has been the situation an hour or two before the close for a few days, but things settle at the end. It may be like that again today of course, or we may see up to a +10 bps rise. Who knows. Our chart will record the final positions. The 90 day bank bill rate is unchanged yet again at 5.64% and now +14 bps above the 5.50% OCR. The Australian 10 year bond yield is up +10 bps from this time yesterday at 4.36%. The China 10 year bond rate is holding low at 2.56% and a new three year low and prior to that pandemic dip, nearing a 21 year low. And the NZ Government 10 year bond rate has risen to 5.21% and up +9 bps to a new 12 year high, and still higher than the earlier RBNZ fix which was up +6 bps to 5.09%. That is also the RBNZ's series highest since July 2011. The UST 10 year yield is at 4.34% and up +6 bps from this time yesterday but little-changed from this morning.

EQUITIES RECOVER SOME
It has been another down day on the NZX50 but this time only a -0.2% fall. The ASX200 is up +0.1% in afternoon trade after yesterday's late fall. Tokyo has opened up +0.6% in its early Tuesday trade. Hong Kong has opened up +0.6% after yesterday's -1.8% fall. And Shanghai is +0.4% higher at its market open after yesterday's -1.2%. The S&P500 ended up +0.7% in Monday trade earlier today with all that gain coming in afternoon trade.

GOLD FIRMS
In early Asian trade, gold is at US$1897/oz and up +US$5 from yesterday.

NZD HOLDING STILL
The Kiwi dollar is still at 59.3 USc basically where it was this time yesterday. Against the Aussie we are firmish at 92.4 AUc. Against the euro we are softish at 54.3 euro cents. That means the TWI-5 is still at 68.3.

BITCOIN STILL ON HOLD
The bitcoin price is little-changed today, now at US$26,048 and down another minor -US$44 from this time yesterday. Volatility has been modest at just over +/- 1.5%.

This soil moisture chart is animated here.

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