Here are the key things you need to know before you leave work today.
MORTGAGE RATE CHANGES
Heretaunga Building Society (HBS) raised rates today. Update: SBS Bank have raised almost all their home loan rates. And The Cooperative Bank has as well.
TERM DEPOSIT RATE CHANGES
Both Xceda Finance and HBS raised term deposit rates today. Update: SBS Bank has raised almost all their TD rates too, likewise the Cooperative Bank.
GRINGING LOWER
The slowdown in auction sales is spreading beyond Auckland to Bay of Plenty and Canterbury. Only around a quarter of properties are selling under the hammer at Auckland auctions, but almost two-thirds in Central Otago-Lakes.
EVERYONE IS HIRING
BNZ/Seek are reporting that job ads hit fresh high in March (amid Omicron’s peak). A desire for full-timers driving it; not contractors or temps. The Hospo sector is recovering well from the February dip. “Orange” and opened borders will offer more scope for hiring, they say.
WE ARE TOO
On those lines, we are hiring. We have multiple openings for experienced business journalists, either in Wellington or Auckland. We would love to hear from you if have experience and enjoy reporting on business and economic matters in a collegial, fun environment, well separated from corporate media 'office politics'. See this.
"KEEP YOUR EYES ON THE HIGHS"
The ANZ World Commodity Price Index hit a new record in March, lifting a further +3.9%. Prices are very strong across most commodities, but none of the sub-indices are currently at record levels. In local currency terms, the index gained just +0.5%, as local returns were eroded by a rising currency (TWI).
OUR SANCTIONS EXTENDED
The Government said today they will apply 35% tariffs to all imports from Russia, and extend the existing export prohibitions to industrial products closely connected to strategic Russian industries. "This is New Zealand’s most significant economic response to the Russian invasion to date."
TAKING 2/3 OFF RETIREMENT BALANCES
Research done for the Retirement Commission appears to indicate that withdrawals to buy homes have had a big impact on retirement savings of young New Zealanders.
CALLING TIME
Public Service Commission (the re-named State Services Commission) has announced the Director-General of Health, Dr Ashley Bloomfield, "has chosen to step down at the end of July".
DATE SET
The Tauranga by-election will be held on Saturday 18 June, necessary on the resignation from Parliament of Simon Bridges.
CHINA IN TROUBLE
China's economic troubles are deepening. Their services PMI sunk sharply in March, according to the private Caixin survey. Unlike the 2020 one with was part of a short-sharp global retreat, they have this one on their own. Services activity fell at its quickest rate since February 2020 amid notable drop in sales. Input cost inflation picked up more than they expected. Business confidence dived to a 19-month low.
ASIC DISLIKES CFDs
In Australia, regulator ASIC has extended its product intervention order imposing conditions on the issue and distribution of contracts for difference (CFDs) for a further five years to 23 May 2027. CFDs enable speculation, not investing, they say.
GOLD SOFT
In early Asian trading, gold is down -US$8 from yesterday at just on US$1921/oz.
EQUITIES ALL LOWER
Wall Street had a down day with the S&P500 down -2.3% at their Tuesday close after taking increasing fright at rapidly rising bond yields. Tokyo has opened down -1.8%. Hong Kong has opened down -1.9% and Shanghai is down -0.5% at their opening. The ASX200 is down -0.9% in early afternoon trade. The NZX50 is down -0.30.3% near the close.
SWAPS UP SHARPLY
We don't have today's closing swap rates yet. They are likely to be up sharply. The 90 day bank bill rate is up +1 bp at 1.67%. The Australian Govt ten year benchmark bond rate is up +13 bps from this morning, now at 2.95%. The China Govt 10yr is unchanged at 2.82%. And the New Zealand Govt 10 year bond rate is now much higher at 3.39% (up +9 bps) and still well above the earlier RBNZ fix for that 10yr rate at 3.33% (up +8 bps). The US Govt ten year is now at 2.61% and a +21 bps leap since this time yesterday. Yes, you read that right. Apart from the gyrations at the start of the GFC, and the confusion in March 2020 confronting the pandemic, this is the largest daily move since we started monitoring it in 2007.
NZ DOLLAR FIRMISH AGAIN
The Kiwi dollar is now at 69.4 USc marginally lower today. Against the Aussie we are -½c lower at 91.7 AUc. Against the euro we are up almost +½c at 63.7 euro cents. That means the TWI-5 is now at 74.9, firmer than yesterday but not by much.
BITCOIN LOWER
Bitcoin is down -2.9% today from this time yesterday to now be at US$45,264. Volatility in the past 24 hours has been high at +/- 3.1%.
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44 Comments
Zoltan Pozsar unpacks the interactions between commodity trading and liquidity requirements. It's way above my pay grade to comment or to try to summarize. But it feels like another Black Swan unfurling its wings....
Just RTWT.
This also from Pozsar last month:
“We are witnessing the birth of Bretton Woods III – a new world (monetary) order centered around commodity-based currencies in the East that will likely weaken the Eurodollar system and also contribute to inflationary forces in the West.” – Zoltan Pozsar, Former Federal Reserve and U.S. Treasury Department official, and now Credit Suisse Global Head of Short-Term Interest Rate Strategy based in New York.
https://www.credit-suisse.com/about-us-news/en/articles/news-and-expert…
"Swaps up sharply" " The US Govt ten year is now at 2.61% and a +21 bps leap since this time yesterday." "New Zealand Govt 10 year bond rate is now much higher at 3.39% (up +9 bps)" " The Australian Govt ten year benchmark bond rate is up +13 bps from this morning, now at 2.95%."
2022 might be right, 2 years fix rates could be 7% soon....
5 year is not very far from 7%.
This is just the beginning.....fed has just raised its first interest rate hike and that too by just 0.25%......much more to come. Reserve bank governors are showing resistance by not raising by 0.5%, which is required and on the other side, did not think when had to drop by full1% plus.
Central bankers experimented with MMT and screwed:
https://finance.yahoo.com/news/verdict-is-in-on-modern-monetary-theory-…
Are they accountable and if yes to whom. Are they still not experimenting to pamper their giant inflatable ego.
The Public Service Commission ( the re-named State Services Commission.) Well then, what’s in a name. From contact with a few identities over the years, understood being called Public Servants was both grating and galling to a large number of said Public Servants. One could assume the previous nomenclature of State Services was in those cases preferable? That is serving the government not the people. Will this new letterhead instil a different set of priorities and values? As sung by The Chapter - only time could let us know!
Treasury Investor Confidence Review gave MoH a “D.” D for dunce. This government, and its predecessors, have had obvious problems with this ministry. The carry on at the Canterbury DHB reveals utter mismanagement from Wellington for example. While I do not agree with DHBs being disbanded because of the then lack of local elected representation, it suggests that this restructure has become necessary in order to break down the fortress bunker mentality that the MoH has clearly embraced. Early on in the covid a clear clue to this aspect, was given when the government ordered that all border staff must be tested. Not only did the MoH refuse to do so, they lied that they were. I have little regard for this government but I do sympathise with them over what they had to take on the chin, absorb the embarrassment, on behalf of the MoH. The new organisation is to see the old existing power of the MoH gutted, reverting to administration and nothing operational. The MoH seemingly, has finally got its comeuppance and it is probably a fair observation that these three resignees, have too bigger boots now for the new job(s.)
that was the DHB not rolling out that due to layers of middle management getting in the way, the MOH were caught in the cross fire trying to explain why some DHB's ie counties were not rolling it out at auckland airport
it is very obvious to anyone that has had dealings with DHB's that they have become mired with layers of middle management that frustrates doctors and nurses on the front line as they know what needs doing but can not because of process and paperwork, hence why NGO's were handed money and sent out because they don't have that structure to deal with
it is crazy auckland has three DHB's with three layers of middle management i.e three HR departments that don't cooperate at all. quite often the MOH has to step in request staff from outside auckland and send them in to help out.
Really -- like all healthcare workers he has worked his bloody arse off for two years doing his absolute best to keep the country safe -- ague about some decisions / timing if you like - but he has done an amazing job -- walking a political tightrope as well as the health one -- and as someone who runs a healthcare company -- the pressure you feel knowing that if you get even a simple decision wrong the consequences are covid in a rest home and 20 deaths for example -- is horrific. He deserves all the accolades we can offer for his efforts - and sadly by not giving himteh head of the new health authority role -- he will be off overseas adn good luck to him
I think there were a lot of people, including the whole country, that are the reason NZ did so well, so far. Also a lot of luck and timing. But we are now getting a lot of deaths occurring and if XE and other variants come in and we just keep getting wave after wave over the next few years, we are going to have a lot more deaths, and Long Covid . There is a reason why China are remaining Covid Free.
Aye, there was a most unsavoury amount of back scratching, amongst the various pulpit participants. Public Servants are meant to be politically neutral for blindingly obvious reasons. I am hard pressed to accept that the relationship here, was not completely compromised in this regard.
Nifty its just the tip of the iceberg -- senior people in teh MOH . DHB's and NGO health are walking out the door in droves -- this governments agenda is so warped its not real -- the MOH just walked away last week from talks on the pay equity settlement for care workers -- leaving employers , Unions and staff in Limbo -- no reason no explanation and no response to any questions why!
Its a shit show -- and its only just starting - providers are giving up contracts to government departments and simply walking away in disgust -- none of the 100 billion borrowed has been given to mainstream NGO providers in Aged Care, Mental Health, Serious Injury - no additional payments to compensate for all the additional costs and disruptions -- and bear in mind -- despite teh option to bring staff who are isolating into work -- most of us have tried not to do this because the risk of bringing infection into those sites is so high and the outcomes for clients so bad - and you can test negative with a RAT but already be infected and contagious
I do believe kpnuts you are 100% correct.
The strains of Covid, festered by a lunatic govt, are proving too much for too many in healthcare. When the play book rules are changed so radically most mortals struggle to adapt.
Bloomfield will be well aware that certain aspects of NZ society are now very angry at his role in what has been a massive destabilising force on this country. And they are getting vocal and organised.
I know, I know, his defenders will proclaim that he was doing his best but yet to rough shod over the process of informed consent was in another world, a crime that would have seen our house investigated by the glorious MoH.
More early signs of the looming slump in residential construction:
https://www.stuff.co.nz/business/128289770/second-auckland-townhouse-de…
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