What happened Friday

A review of things you need to know before you go home on Friday; very low mortgage rate, expensive SME rates, brighter dairy payout expectations, swap rates unchanged

4th Sep 15, 3:59pm by David Chaston

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

TODAY'S MORTGAGE RATE CHANGES
BNZ has launched a record-low one year fixed mortgage rate. It is on offer until September 20, 2015.

TODAY'S DEPOSIT RATE CHANGES
The RaboDirect Premium Saver has been reduced to 3.75%. BNZ has reduced its Personal On-call account to 2.30%.

EXPENSIVE DEBT
SME overdraft base rates have fallen below 10% in August for the first time since May 2014, according to RBNZ monitoring. The rate measures the set base rate component of the product offered to customers and does not include any margin component added to this rate, which is related mostly to individual borrowers’ credit risk. If these rates don't include borrower credit risk, these base rates then just reflect the cost of funding which makes them very lucrative indeed for banks. One year swap rates today are only 2.76%. Bank credit spreads are less than 100 bps.

LOW PAY BRINGS STRIKES
Warehouse workers have extended their store-by-store strikes after receiving a low wage offer. After strikes at the Warehouse Manukau, Blenheim and New Lynn, workers at the Warehouse Rotorua will walked off the job at noon today.

A BRIGHTER VIEW
Westpac has made a significant change to its milk price forecast for the season, following dairy prices rising a further 10.8% at Wednesday morning's GlobalDairyTrade auction. It's increased its farmgate price forecast from $3.70 per kilo of milk solids, to $4.30. Fonterra's forecast for the season remains at $3.85/kg, while ASB's remains at $4.50/kg.

A TALE OF TWO FLOWS
Unlike New Zealand, Australia is no longer attracting visitor growth in the way it was. In the year to July, visitors to the Lucky Country grew +5.7% compared to New Zealand's +7.3%. Permanent migrant flows are declining. In Aussie they fell +3.5% year-on-year to July while ours grew +14.4%.

BIG DATA
Some big decisions in both New Zealand and the US will be made over the next two weeks. One important component of the US decision will be the state of their jobs market. Interest readers should check our Economic Calendar which will have the results of the US Non-farm payrolls jobs growth early tomorrow morning. It is data that may move markets, including NZ markets.

WHOLESALE RATES UNCHANGED
Swap rates were essentially unchanged today. The 90 day bank bill rate went down by -1 bps to 2.89%.

NZ DOLLAR SLIPS
The NZ dollar held against the greenback but strengthened against most others. It is still at 63.7 USc, now up at 91.3 AUc and 57.2 euro cents. The TWI-5 is still at 68.7. Check our real-time charts here.

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

Daily exchange rates

Select chart tabs

Source: RBNZ

Source: CoinDesk

We welcome your comments below. If you are not already registered, please register to comment

Remember we welcome robust, respectful and insightful debate. We don't welcome abusive or defamatory comments and will de-register those repeatedly making such comments. Our current comment policy is here.

2 Comments

by profile | 4th Sep 15, 4:19pm 1441340348

Phew! 2.6 trillion trees found. Everyone pat themselves on the back for all that paper recycling and ETS schemes.

"There are just over three trillion trees on Earth, according to a new assessment.

The figure is eight times as big as the previous best estimate, which counted perhaps 400 billion at most.

...The more refined number will now form a baseline for a wide range of research applications - everything from studies that consider animal and plant habitats for biodiversity reasons, to new models of the climate, because it is trees of course that play an important role in removing the greenhouse gas carbon dioxide from the atmosphere.

...And Dr Martin Lukac from the University of Reading was still not sure we were near an accurate count.

"The previous estimate of trees in the world was 400 billion. The new estimate is three trillion large trees. There are so many margins of error in this study that the real number could be anything between the two - or even 10 times higher," he said. "

http://www.bbc.com/news/science-environment-34134366

by bender | 4th Sep 15, 7:10pm 1441350615

"...new models of the climate, because it is trees of course that play an important role in removing the greenhouse gas carbon dioxide from the atmosphere." CO2 keeps rising apace, hottest records set monthly, 3 T trees not enough apparently.