A review of things you need to know before you go home on Monday; both home loan and terms deposit reductions, services, construction and retail strong, Wholesale interest rates up, NZD nears AUD record

Here are the key things you need to know before you leave work today.

TODAY'S MORTGAGE RATE CHANGES
BNZ cut its three year fixed Classic rate to 5.59%. (Both SBS Bank and Kiwibank have a lower rate for this term however.)

TODAY'S DEPOSIT RATE CHANGES
BNZ cut term deposit rates for terms 9 to 18 months which all went down between -5 and -10 bps. They also cut their cash PIE account as well as their Rapid Saver rate, down -10 bps to 3.9%. Kiwibank took -10 to -20 bps off all its term deposit rates from 1 to five years.

SERVICE SECTOR HEALTHY
After Friday's report of the factory sector expanding more modestly than it has recently, today's report on the service sector was much more upbeat. BNZ senior economist Craig Ebert said, "The relative health in the latest PSI gels well with a burgeoning labour market, high net inward migration and a reheating housing market. It's a big relief to see the PSI get even stronger in January, compared to the abrupt slowing of its manufacturing cousin the PMI."

TWO-SPEED CONSTRUCTION MARKET
Readymix concrete production was up +15.7% over the same quarter a year ago, confirming very healthy construction sectors in Auckland and Christchurch. Things were pretty limp in Wellington though.

DISCRETIONARY SPENDING UP
Retail sales for the December quarter came in stronger than expected at +4.7% year-on-year. That was up from +4.1% in the September quarter. Retailers involved in discretionary spending such as hospitality, furniture and electrical goods all had a great quarter. Petrol stations treaded water as pump prices started to fall during the period. But like the concrete stats, the gains were geographically concentrated in Auckland and Canterbury.

DAIRY SENTIMENT TURNING UP?
On Wednesday we get the next dairy auction results. BNZ today noted this: "Note that Fonterra may well update the market on its 2014/15 milk price forecast this week (or next?), in keeping with its late-February updates in the past. We would expect the co-op to maintain its view of $4.70 / kgMS (barring a shock result at this week’s auction). Sizeable international price improvement over coming months is still required to achieve this. Our point estimate for the 2014/15 milk price, at $4.50, remains pitched a bit under Fonterra’s. But the risk around our forecast has shifted from balanced to upwards following the previous big auction result (+9.4%)."

WHOLESALE RATES FALL
After the push higher in benchmark bond rates in New York on Friday, our wholesale swap rates have risen today, up +3 bps across the curve. The 90 day bank bill rate went the other way, falling -1 bps to 3.63%.

NZ DOLLAR RISES
Check our real-time charts here. The NZD pushed up to 96.48 AUc, a new record post-float high, on the strong December retail sales data. We fell back soon after but are back on the rise again at the end of the day. We are now at 75 USc, at 96.4 AUc , and the TWI is at 78.2.

You can now see an animation of this chart. Click on it, or click here.