Here are the key things you need to know before you leave work today.
TODAY'S MORTGAGE RATE CHANGES
No changes today.
TODAY'S DEPOSIT RATE CHANGES
RaboDirect reduced its 1 month TD to 2.05% from 2.30%. They also cut their RaboSaver to 1.75%.
CONSTRUCTION HOT, EXPORTS NOT
The New Zealand economy expanded at a pace of +2.8% pa in the first quarter of 2016 which was slightly stronger than the RBNZ’s forecast of +2.7% and beating most economists forecasts. Strong growth in the construction sector, combined with a steady expansion in health care services were the main drivers over the quarter. The NZD rose on the news. This data came a day after our current account deficit for the same period also came in better than forecast. Together they reduce any pressure the RBNZ may be feeling to cut rates, pretty much confirming the perspectives they offered at the MPS earlier this month.
FILLING THEIR BOOTS
Investors can't get enough of the NZGB 2020 maturity nominal bond. Today's tender was oversubscribed 4.5 times. Today's average weighted yield was close to 2.09%. Five tenders ago (the last one in 2015) that yield was 2.87%. At this rate, the next one will see the yield likely dip below 2%.
DECELERATION?
In Australia, it is becoming clear that their car sales market has passed its peak.
LESS CHANCE OF AN RBA CUT
And staying in Australia, their employment data was pretty steady. This is being seen as easing the pressure on the RBA to cut rates there.
TOKYO EQUITIES SINK
Equity markets in Australia and New Zealand are higher today, but lower in Tokyo, Hong Kong and level-pegging in Shanghai. The drop in Japan is notable at almost -2% on the day - so far.
SWAP RATES LOWER & FLATTER
Even further wholesale rate falls today, down between -1 and -4 bps across the curve. The 2-10 curve is now at +48 bps. The 1-5 curve is just +15 bps. NZ swap rates are here. The 90-day bank bill rate is unchanged today at 2.34%.
NZ DOLLAR RISES
The NZD rose on the good GDP growth data and the indication the trend is likely to continue for a while yet. Is now at 70.8 USc, at 95.7 AUc, and 62.8 euro cents. The TWI-5 is now at 74.2. Check our real-time charts here.
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8 Comments
Equity markets in Australia and New Zealand are higher today, but lower in Tokyo, Hong Kong and level-pegging in Shanghai. The drop in Japan is notable at almost -2% on the day - so far.
Yes, the wheels are falling off as dislocation risk exercises restraint upon the “invisible hand of the market”.
Buying by the BOJ has helped boost premiums on J-REITs, which manage rental properties such as apartments, offices and malls, to 62 percent as of June 8, meaning investors would pay almost two-thirds more than the appraised value of properties they own, according to S&P Global Market Intelligence estimates. That gap makes J-REITs outliers compared with similar securities around the world, and suggests that the BOJ’s stimulus is stoking extreme price dislocations in this market. Read more
Down nearly 1200 points in 5 days.
https://in.finance.yahoo.com/q/bc?s=%5EN225&t=5d&l=on&z=l&q=l&c=
Time for another 'blood transfusion'? Or perhaps a 'kickstart'.
I picked this last week, now I am changing my mind to no more FED rises this year
http://www.cnbc.com/2016/06/15/fed-leaves-rates-unchanged-in-june-meeti…
You are correct sharetrader.
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