A review of things you need to know before you go home on Monday; the week starts with some tough economic data, Australia past the peak for Omicron, swaps firm, NZD soft & more

Welcome to our first of these daily summaries in 2022. Here are the key things you need to know before you leave work today.

MORTGAGE RATE CHANGES
No changes to report today.

TERM DEPOSIT RATE CHANGES
ICBC have raised their term deposit rates.

WELLINGTON HOLIDAY
Data flows are light today because Wellington and Government agencies are on holiday. (Auckland Anniversary is next Monday.)

HOUSE PRICES SLIP FOR FHBs, BUT ITS NOT ENOUGH
We have released our Home Loan Affordability update for December 2021. Rising interest rates and sky high deposit requirements are pushing home ownership further out of reach for people on average wages, even as the market cools.

TRUST & DISTRUST, AUSSIE-STYLE
In Australia, Roy Morgan Research measures brand Trust and Distrust. They report that supermarket chains have high levels of trust there, miners, banks and other financial businesses have high levels of Distrust there. (AMP is the current whipping boy, but the growing Dixon disaster will compound the feeling.) In the media landscape, no matter your age, voting intention or wealth, just about every sector distrusts News Corp. It's not all media; the ABC scores high on the Trust side. (News Corp remains and grows because it buys up its rivals.)

AUSTRALIA STARTS 2022 WITH A CONTRACTION
The latest PMI data for January in Australia shows their private sector shrank for the first time in four months, affected by the latest surge in Omicron infections. Private sector output and demand both fell in January which led to employment growth grinding to a halt. Meanwhile, amid the disruptions backlogged work continued to build while input price inflation rose (and the RBA would have noticed that). Business optimism was likewise affected, falling sharply at the start of the year. The factory expansion slowed but at least it is still expanding. Their service sector is now contracting and rather sharply.

DITTO JAPAN
The story in Japan is similar, with a sharpish contraction in their services sector, although Japanese factories are expanding a bit more vigorously. The net of the two means they are now going backwards in January.

LOCAL PANDEMIC UPDATE
In NSW, there were 8,190 new community cases reported yesterday, a big fall, now with 227,428 active locally-acquired cases, and 24 daily deaths. There are now 2,816 in hospital there and a record high. In Victoria they reported 11,695 more new infections yesterday, also a fall. There are now 252,399 active cases in that state - and there were 13 more deaths. Queensland is reporting 10,212 new cases and 13 more deaths. In South Australia, new cases have slipped to 2,062 yesterday with no more deaths. The ACT has 756 new cases and two deaths, and Tasmania 619 new cases. Overall in Australia, 40,435 new cases have been reported so far although not all counts are in yet. In New Zealand, there were 50 cases stopped at the border, plus 25 new cases in the community. Testing shows 8 had Omicron. There are 467 active cases in isolation, a fall. More than 1 mln booster shots have now been given, 57% of those eligible.

GOLD SOFT
In early Asian trading, gold is at US$1833 and down -US$3 from this morning's open.

EQUITIES MOSTLY LOWER AGAIN
The S&P500 futures suggest Wall Street will open tomorrow +0.5%, so last week's losses are stemmed if that is what transpires tomorrow. But last week consecutive days of losses, heavy selling in the final hour of trade, and the reversal of intraday gains are all worrying signs on global markets. Today, the NZX50 is down -1.3% in late trade which extends the local selloff. Since the start of 2022, this index is down a painful -6.5%. The ASX200 is down -0.6% in afternoon trade, and for 2022 is down a net -6.0%. Tokyo has opened down -0.7%. But Hong Kong is down -1.1% at its open and Shanghai is down -0.3% in very early trade there.

LOCAL EQUITIES BLEED
On the NZX50, last week's -3.5% drop in capitalisation was grim for the local index. Among these fifty, the largest fall for the week was by Oceania Healthcare (OCA, #34) which fell -7.7% in just seven days. Only seven of these 50 companies posted gains for the week. Everything else fell. In fact Fisher and Paykel Healthcare (FPH, #1) dropped -6.8% which alone tanked the market cap by more than -$1.2 bln. Auckland International Airport (AIA, #2) also dropped -5.0% and Mainfreight (MFT, #4) dropped -6.3%.

SWAPS FIRMISH
We don't have today's closing swap rates yet. They are likely to be firmer. The 90 day bank bill rate is down -1 bp at 1.07%. The Australian Govt ten year benchmark bond rate is up +4 bps at 1.92%. The China Govt 10yr is down -2 bps at 2.71%. The New Zealand Govt 10 year bond rate is now at 2.56% and up +4 bps and back above the earlier RBNZ fix for that 10yr rate at 2.55% (down -2 bps). The US Govt ten year is now at 1.78% and up +1 bp.

NZ DOLLAR SOFT
The Kiwi dollar has stayed down at 67.1. (Westpac strategists said they had a 'trade idea' to sell the NZD, targeting 66 USc. But they also say "event risk" is high.) Against the Aussie we slipped back a little to 93.5 AUc. Against the euro we are still at 59.2 euro cents. That means the TWI-5 is now just over 71.5 and marginally lower.

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BITCOIN HOLDS LOWER
The bitcoin price is now at US$35,868 and a small +1.6% rise from where we opened this morning. Volatility over the past 24 hours has been moderate at just over +/- 2.7%.

This soil moisture chart is animated here.

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