Here are the key things you need to know before you leave work today.
MORTGAGE RATE CHANGES
None today. But Heartland is now saying it will make mortgage decisions within 48 hours in its rate-competitive home loan program.
TERM DEPOSIT RATE CHANGES
BNZ has raised all its term deposit rates from 5 months to 2 years. Update: ICBC has also raised term deposit rates.
MORE AFFORDABLE/LESS AFFORDABLE
Home loan affordability improved in February in Auckland (if you have the deposit) as house prices for lower quartile homes fell faster than mortgage interest rates rose. Outside of Auckland the situation is different. There haven't been the big price falls seen in Auckland over the last few months, so rising interest rates are making houses less affordable.
ME TOO
Fonterra said it will close its office in Moscow and relocate staff elsewhere. It is confident of finding alternative markets for dairy products sold there, especially butter.
MORE TRADE, BIGGER DEFICIT
Surging oil prices help push NZ to a record monthly trade deficit for a February and the annual deficit for the year to February hit an all-time high of -$8.4 bln. Since records began in the 1960s, there have only been 13 deficits in a February, most of them more recently. Much of this negative shift was due to the +106% rise in value of petroleum products imported compared with a year ago, which more than offset surging dairy export prices.
CREDIT CARDS FADE
Credit card balances continue to fall and the February debt is now -6.5% lower than a year ago at under $5.9 bln. In February 2021 it was $6.3 bln. But card account balances that incur interest pushed back up, reversing a recent trend lower. Credit card transaction usage however is still rising even if only very marginally, and less than CPI inflation.
RECOVERY OF SORTS
The NZX50 bounced back last week, reducing its loss from a year ago. Only ten on this capitalisation list fell, the largest being Fletcher Building (FBU, #8), down -2.8%. Overall the index rose +2.7% but there were some big rises among them. Auckland Airport (AIA, #2) was up +11.1% over the week, Pushpay (PPH, #28) was up +12.5% for the week. Heartland Group (HGH, #25) was up +10.6%, Skellerup (SKL, #27) was up +10.6% and Tourism Holdings (THL, #48) was up +15.9% for the week.
IAG SEEKING $400 MILLION
Insurer IAG is seeking to borrow NZ$400 million through an offer of unsecured, subordinated notes. The indicative margin is 1.90% to 2.10% per annum above the swap rate. The interest rate until a first optional redemption date on June 15, 2028 will be fixed. If the notes aren't redeemed then, the interest rate will be floating until the June 15, 2038 maturity date. The actual margin and interest rate will be announced on March 25, with the notes expected to be issued on April 5. IAG says proceeds of the offer will be used for its general corporate purposes including refinancing existing debt.
TECHNICAL ISSUES
A malicious bot got into our [separate] email system, which we have had to quarantine. That means newsletters aren't being sent today, nor registration notices for readers signing up. We have sorted the core issue, but it might be some time to complete the QA and get this system restarted. It isn't affecting any other aspect of our service. Apologies if you are affected.
TAYLOR 'GOING FOR THE CHALLENGE'
ANZ says it is losing its CFO, Stewart Taylor, to insurance company Partners Life, where he will also be CFO.
NO CHANGE
China has kept its prime loan rates unchanged in their March review. This was what markets were expecting.
GOLD ON HOLD
In early Asian trading, gold is unchanged from where we opened earlier today at US$1922/oz.
EQUITIES MIXED
The NZX50 has opened down -0.4% in late afternoon trade today. The ASX200 is unchanged in early afternoon trade after starting up +0.3%. Tokyo has opened up +0.7%. Hong Kong has opened +1.1% higher in very early trade. And Shanghai has opened barely higher, up just +0.1%. The S&P500 futures show that Wall Street is heading for a -0.2% slip in their opening tomorrow.
SWAPS HOLDING
We don't have today's closing swap rates yet. They are likely to have changed little today, maybe a touch lower. The 90 day bank bill rate is unchanged at 1.56%. (A week ago it was 1.48%.) The Australian Govt ten year benchmark bond rate is up +3 bps at 2.55% from this morning. The China Govt 10yr is up +1 bp at 2.83%. The New Zealand Govt 10 year bond rate is now at 3.18% (down -1 bp) but still higher than the earlier RBNZ fix for that 10yr rate at 3.16% (down -2 bps). The US Govt ten year is now at 2.15% and unchanged from this time this morning.
NZ DOLLAR FIRM
The Kiwi dollar is now at 69.2 USc and back to our high Saturday level, a four month high. Against the Aussie we are little-changed at 93.3 AUc. Against the euro we are marginally firmer at 62.6 euro cents. That means the TWI-5 is now just over 74.3.
BITCOIN LITTLE-CHANGED
Bitcoin is little-changed today, now at US$41,303 and down just -0.2% from where we opened this morning. Volatility over the past 24 hours has been modest at just under +/- 1.4%.
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30 Comments
https://worldhappiness.report/
9th is a stellar ranking.
Happiness and prosperity rankings seem to be highly correlated.
https://www.prosperity.com/rankings
Pretty much the same countries in the top ten. Israel let down by it's safety & security rating as is NZ. We could be so much better even than this.
Happiness is relative. If you are low in the pecking order and have no chance of changing status then you are miserable, suffer mental stress, etc.
I remember watching on TV the LA Watts riots of 1964. Widespread rioting, looting, assault, arson, protests, firefights, property damage. I was in the UK and couldn't understand how these people in housing better than ours, with colour TVs and cars had anything to worry about. In those days poverty meant being underweight not obese.
To keep NZ happy slow down population growth, clean our environment, narrow income distribution and especially for families.
I seem to have touched a nerve What was I wrong about - as my epistemology lecturer said be precise. You say that the index is "not meant to reflect the life experience of every individual" . Then what is the point of the index - it doesn't impart any meaning full information - it is shallow (and you did describe yourself as shallow) , used by people to not do something and is a ranking only amongst other country's not against some ideal. That would be more meaningful. It would show where NZ has to improve.
I would argue that this index is and example of toxic positivity which is defined as
Toxic positivity involves dismissing negative emotions and responding to distress with false reassurances rather than empathy. It comes from feeling uncomfortable with negative emotions. It is often well-intentioned but can cause alienation and a feeling of disconnection
It allows people to ignore what makes them uncomfortable. The reality is NZ is not as great as people make it out to be.
Yes, exactly. Of course we aren't perfect and income and wealth disparity is a bad development. We also rank high in livibility.
Look at the Scandi's, I wonder whether the high tax/high social welfare model is the reason? That model crushes the relative wealth distribution, if everyone earns the same as you, and is worth the same, give or take does that make the general population happier?
Probably just countries where people aren't in your face all the time demanding you behave in a certain way. You're pretty much free to be whoever you want to be. This is advanced civilization. Millions of little "empires of the mind" free to think , explore and do whatever they like, within reason.
CREDIT CARDS FADE
Credit card transaction usage however is still rising even if only very marginally, and less than CPI inflation.
Credit card spending within NZ is flatlining for the first time since the GFC and today's data shows the biggest January to February month-on-month drop since 1994 (when the data started). Teetering on the edge of a collapse in demand (if it hasn't already happened). Quick, errm, increase the OCR.
Instead of dropping the OCR to zero the last 30-40 years because cheap foreign made goods were deflationary, why didn’t we just limit the amount we imported, manufacture locally, so that we didn’t experience that deflationary impulse and have the benefit of greater industry?
interest rates could have remained much higher and avoided blowing debt/asset bubbles.
I think we have to more or less align OCR rates with other countries to manage the inflow and outflow of foreign investment in our financial assets. We couldn't have been sat at 3% with the rest of the world on zero.
We could have avoided our biggest asset bubble by controlling borrowing on residential property more tightly - e.g. no leveraging off other property equity unless you are a licensed social landlord, 100% tax on inflation adjusted profits from land sales. Similarly, a ban on share buy backs could have helped prevent financial asset bubbles.
""NZ to send body armour, helmets, camouflage vests to Ukraine""
https://www.1news.co.nz/2022/03/21/nz-to-send-body-armour-helmets-camou…
A conversation in 404, pre-sally, between Quartermaster Q and the latest volunteer V to take up arms:
Q can you shoot a rifle?
V yes, sah!
Q rightio, then, pray don this body Armour, camo and helmet thoughtfully supplied by some island in the Pacific.
V yes, sah!
Q now toddle off and get your marching orders from that big training facility down in the next block.
V yes sah!
(toddles)
Stage right, the inaudible sound of a hypersonic missile targeted at, you guessed it...
V well that camo wasn't much help then.....(dies)..
Oil is bouncing back again I see. We really need to poke some more holes in the ground:
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