Here are the key things you need to know before you leave work today.
MORTGAGE RATE CHANGES
There are no changes to report today.
DEPOSIT RATE CHANGES
TSB Banks has raised rates for all term deposits of one year and longer. Its 5 year rate is now at 4%. Its 13 month 'special' is unchanged at 3.65%. Other terms have seen rates rise between +20 and +30 bps. BNZ has cut most interest from almost all its savings accounts, some effective today, some effective on Christmas Eve. Most call accounts now or will soon only offer 0.10%, and that includes their flagship TotalMoney accounts - and for them only for balances over $1000,000. BNZ's bonus saver account, Rapid Save, will now return 2.35% if you meet the monthly criteria.
EXPLICIT FEE
ANZ has extended its cash advance credit card fee for its Freestyle Mastercard when you make an overseas cash advance, to $5 per transaction, just like all of its other cards. It didn't publish a fee for this previously.
SETTLING DOWN?
Local authorities get revenues from rates, fines, fees, and petrol taxes, as well as grants from central government agencies, earnings from investments, and trading enterprises. We track their overall revenues from rates and regulatory fees (fines, fees and petrol taxes) and these grew at a relatively slow +4.2% in the September quarter compared with the same period a year ago. In the September 2015 quarter these grew at +8.6% pa. and that was primarily due to a rush to raise fees. In the September 2015 quarter, the fee growth was an eye-watering +23.1%, but this year it is much lower growth, only +5.5% pa. So these higher fee levels are now embedded. All the talk is of restrained rates; but it is the fees that keep our non-tradeable inflation high.
ABOUT TO EXPLODE?
Inflation in China is tracking higher. It came in at 2.3% for November, well above the 1.5% in the same month a year ago. Producer prices are moving up too; in fact they have raced up to +3.3% in the November year, far above the deflationary -5.9% a year ago. This move has been so fast, and accelerating so quickly recently, you do wonder if prices are about to get out of hand there.
LOCAL INFLATION
Inflation in New Zealand is apparently running at 2.1%, according to the ANZ unofficial monitoring. Rents are the main driver, says ANZ.
RETAIL SALES HANG IN THERE
The first indication of retail sales for November were out today, and this period included the Kaikoura/Wellington earthquake. Overall total retail using electronic cards was up +5.8% year-on-year vs +4.2% year-on-year to October. But when you look just at November and adjust for seasonal effects, these sales were marginally lower than for October, and the earthquake may have been a reason.
HIGHER DEMAND, HIGHER YIELD
Investors still like NZ sovereign debt, but they do demand a better yield. The latest NZGB bond tender for 2035s resulted in a yield of 2.42% today, up from 2.25% at the previous tender. This latest tender was very well bid with a coverage ratio of 5.4x, much better than the 4.6x last time and the highest in six months.
SORRY
We are under a DOS attack which might be why you have only had intermittent access today. Sorry. We are fighting back as best we can.
WHOLESALE RATES RISE & STEEPEN
Swap rates have risen and steepened today, following the moves on Wall Street earlier today. The two year is up +3 bps, the 5 year is up +6 bps, and 10 year is up +7 bps. These moves cancelled out all of yesterday's falls. The 90-day bank bill is down -1 bp however at 2.03%. NZGB bond yields are unchanged.
NZ DOLLAR UP
The Kiwi dollar has moved lower against a rising US dollar but higher on the cross rates. It is now at 71.7 USc. On the cross rates it is at 96.2 AUc, and is up at over 67.7 euro cents. We are over 82 yen now, and that is a one year high. The TWI-5 now at 77.7. Check our real-time charts here.
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3 Comments
Your comment about non-tradeable inflation makes my blood boil .
Its little wonder we have non-tradeable and Administered Cost inflation when we have wasteful expenditure at local government level on the scale we have currently.
When Auckland became a supercity there were around 5,500 employees , and I gather there are now around 8,000 employees, someone even suggested it was as high as 10,000 .
How on earth did we get into such a mess , and why did we ever agree to becoming a unitary city because none of the benefits we were sold , have come to fruition ?
The rating system was truly shambolic , although thankfully my rates went down
The Unitary Plan has been equally shambolic , and the net result is not going to solve the problems of an exploding population , or enable us to have affordable housing .
There seems to be absolutely NO PLAN to reduce the congestion , just suggestions of a toll , and we all know that tolls dont reduce congestion .We still have a ridiculously over-priced and subsidized bus system , owned by a cartel of half a dozen owners , and one of whom is said to be very close to being a Rich Lister
I would really like to know exactly what these 8,000 civil servants actually do all day , because they are sure as hell costing us ratepayers a bundle .
I was recently in the old West Auckland municipal offices , and it does not seem like anyone is actually doing anything productive there at all .
I wonder how we got into this mess , because if Auckland City was a company that had to compete and make a profit to survive , with so many staff doing very little it would go bankrupt.
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