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A review of things you need to know before you go home on Friday; minor retail rate changes, stronger PMI, Worldline's EFTPOS on Xero app store, Aussie inflation expectations bite, swaps stable, NZD softer & more

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A review of things you need to know before you go home on Friday; minor retail rate changes, stronger PMI, Worldline's EFTPOS on Xero app store, Aussie inflation expectations bite, swaps stable, NZD softer & more

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

MORTGAGE RATE CHANGES
Kookmin Bank raised rates today. ICBC raised them very late yesterday. Heartland Bank raised its market leading floating rate by +26 bps to 3.25% and all its fixed rates.

TERM DEPOSIT RATE CHANGES
On the TD front, Kookmin Bank also raised rates today and ICBC raised them very late yesterday.

SOUTHERN STRENGTH
The October factory PMI for New Zealand came in much more expansionary than the one for September. But BNZ Senior Economist, Doug Steel stated that “even though October’s reading is above average, we’d classify it more in the realm of some recovery from a large hit rather than an indication of outright strength." It was depressed in Auckland, but the further south you go the better is becomes. A bright spot is that employment is holding up despite all the pressures. The overall improvement can also be seen in the rising demand for electricity.

WORLDLINE JOINS XERO APP STORE
Worldline, formerly Paymark, has joined the Xero App Store providing a service that lets small businesses accept customer payments for Xero-generated invoices via Online EFTPOS. Online EFTPOS allows consumers to pay for products and services online using money directly from their bank account. Now, when Xero users generate and send an invoice to a customer, they can connect them to Online EFTPOS to accept payment in this manner.

A SHARP AUSSIE BITE
In Australia, inflation expectations rose to 4.6% in November from 3.6% in October. That is a sharper jump than the actual inflation in September of 3.0%.

LOCAL PANDEMIC UPDATE
In Australia Delta cases in Victoria have slipped to 1115 cases reported there today. There are now 16,098 active cases in the state (another increase) and there were another 9 deaths yesterday. In NSW there were another 286 new community cases reported today with 2,845 active locally acquired cases (both increases too), and they had another two deaths yesterday. Queensland is reporting two new cases. The ACT has 15 new cases. Overall in Australia, just over 82% of eligible Aussies are fully vaccinated, plus 8% have now had one shot so far. In contrast, there was one new case in New Zealand at the border, and 201 new community cases. Now 89.9% of Kiwis nationally aged 12+ have had at least one vaccination, and the Australian rate is now also at 89.9% of all aged 16+.

GOLD FIRM
In early Asian trading, gold is at US$1859/oz and up another +US$9 from this time yesterday. That is a little lower the closing New York price, but above the earlier London fix.

EQUITIES FIRMER IN ASIA, MIXED LOCALLY
The NZX50 is down -0.6% in late trade today, heading for a -1.0% fall for the week. The ASX200 is up +1.1% in early afternoon trade today, heading for an unchanged week. Tokyo is also up +1.1% in early trade today, clawing back some of the losses earlier in the week. If it finishes at this level it will end its week down -0.4%. Hong Kong is up +0.6% in early trade today, heading for a weekly gain of +2.6%. Shanghai is flat in their early trade, heading for a weekly rise of +1.2%.

SWAP & BONDS RATES LITTLE-CHANGED
We don't have today's closing swap rates yet. They are probably flatter. The 90 day bank bill rate is up yet another +1 bp at 0.85%.The Australian Govt ten year benchmark rate is now at 1.83% and down -1 bp. The China Govt 10yr is now at 2.95% and up +1 bp. The New Zealand Govt 10 year rate is now at 2.63%, unchanged and still below the earlier RBNZ fix for that 10yr rate at 2.64% (unchanged). The US Govt ten year is still at 1.57% because US bond markets are closed today.

NZ DOLLAR SOFTER AGAIN
The Kiwi dollar is now at 70 USc and -½c lower than this time yesterday. Against the Aussie we are only lower at 96.1 AUc. Against the euro we are down at 61.2 euro cents. The TWI-5 is now back down to 74.3 and a -50 bps retreat since this time yesterday.


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BITCOIN SETTLES
The bitcoin price is now at US$65,144 and a net +1.0% higher than this time yesterday. Volatility in the past 24 hours has been quite modest at just over +/- 1.1%.

This soil moisture chart is animated here.

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Daily exchange rates

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Source: CoinDesk

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19 Comments

Sorry about the DGM but you're not going to read anything in Granny Herald about it. 

Because of the pre-sales model for China housing, housing starts are still ramping up in China, but prices are collapsing and nothing the buyers can really do about it, except for a govt bailout I guess.

Now, good lesson for Nu Zillun'. If you're expecting busloads of Chinese turning up to your suburb willing to pay a king's ransom for your modest abode, it might be time to think about how realistic that really is going forward. 

https://www.bloomberg.com/opinion/articles/2021-11-11/china-s-dangerous…

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Granny Herald, Nu Zillun.

 

JC been on the wrong side of the forecasts for as long as it takes a snail to mount Everest :)

 

 

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Houseworks your back??

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HW = Headwinds. I remember Houseworks too but cannot take credit

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JC been on the wrong side of the forecasts for as long as it takes a snail to mount Everest :)

Just a hunch. Not a forecast. That king's ransom might still be possible. Just harder to get across the line. 

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Interesting data point.

The lower-quartile suburbs I watch in West Auckland today hit a number of listings higher than anytime in last 10 years.

There's always a spring surge, but this beats other years. Last highs before this were equal , being the dip in 2010 and the pause in 2016.

Leading indicator?

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A real 'boots on the ground' report.  Not wishful thinking.

In leafy Royal Oak street with high-density home-units leading up to pedestrian access direct to Cornwall Park, still no forsale signs today; same as I reported a few days ago.  This is absolutely incredible...the first time I have seen no sign at all in 15 years.

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The sharemarket's been on a real downer this week, finishing even lower today.  Nothing left for boomers to invest in...only houses, even if they stay empty.

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Early 1990s, some London streets had no "For Sale!" signs up at all - but half the street was quietly for sale. No point frightening potential buyers with a sea of signage. (Experience is a wonderful teacher! -  I didn't know about the lack of signage; bought and 2 months later was 20% worse off as the  new 'value' of like properties had all been affected by one buyer from HK who defaulted, and the owners sold up, keeping his 20% deposit and discounting the price by that much to move it on)

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So, in normal times, even if there were plenty of house-for-sale signs this would be frightening buyers.  Then why do agents bother putting up signs at all?

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Elm st

You poor thing ... from Bondi to London, now ... 

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This sort of thing is a real concern, when the housing market starts going South, houses that have sat empty getting free Capital Gains (which there are a lot of) will be rushed onto the market.  It will likely accelerate a down turn.

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But we've been told for a couple of weeks now by all and sundry including a couple of the big banks' economists that a housing downturn is coming.  But still no action.  Wishful thinking can curdle peoples' minds if fulfilment doen't happen.  I'm sure that this is what's happening.

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In other news ag/foresrty/fishing was a rounding error of a rounding error - and methane didn't feature. To sell a few more papers Stuff claims the "earth is basically on fire..."

"Greenhouse gas (GHG) emissions from industries and households rose by 4.8 per cent in the June 2021           quarter, according to Stats NZ data.

This follows an earlier 1.4 per cent increase in the March quarter and was mainly due to a large increase in the use of coal to produce energy.

The largest contributors to the increase were electricity, gas, water, and waste services up 16 per cent; transport, postal, and warehousing up 19 per cent; and agriculture, forestry, and fishing up 0.9 per cent (seasonally adjusted).

Environmental economic accounts manager Stephen Oakley said the electricity, gas, water, and waste services sectors reached a record quarterly level of 2927 kilotonnes of GHG emissions (seasonally adjusted), up 412 kilotonnes on the March quarter.

“This is mainly due to a large increase in coal use for electricity generation,” he said. 

...Carbon dioxide was the gas most affected during that period but methane remained stable (farming did not cease during lockdown). "

https://www.stuff.co.nz/environment/climate-news/126942398/greenhouse-g…

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“This is mainly due to a large increase in coal use for electricity generation,”  The only major power station producing electricity from coal is Huntly power station. Might a few other micky mouse ones. No doubt unreliables (wind and solar) play a large role in needing to generate electricity from coal. Must still be profitable even if Huntly have to buy carbon credits. Would be interesting to know how many hectares of trees are needed to offset a months worth of one Huntly generator (250MW) generating full bore. KW to do a calc?

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An inflation anecdote: 

Replaced 2 tyres today - $264 each (incl GST).

Same tyres, same store (a big retailer) 3 years ago - $215 each

Works out to 7% inflation per year over last 3 years. 

According to the "Table" tab here on the Stats site the CPI over the last few years has been mostly around 1.5% to 1.9% with a spike to almost 5% in the last few months:  

https://www.stats.govt.nz/indicators/consumers-price-index-cpi

 

I guess I put the wrong stuff in my basket  :(

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Covid-19: Researcher blows the whistle on data integrity issues in Pfizer’s vaccine trial

https://www.bmj.com/content/375/bmj.n2635

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Builds a picture of trials being rushed through and nothing being allowed to get in the way.

A lot of money at stake, I guess.

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There is a scary spike in food prices coming, because fertiliser prices are going parabolic.

See this mentioned at 22:30 in this DFA item today:

https://www.youtube.com/watch?v=-IQm_bp9894

Food price rises tend to trigger riots and toppled govts.

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