A review of things you need to know before you sign off on Thursday; floating rate rises start to come through, TD rates up too, HPI sinks, wealth withers, winter ills motivate Govt, swaps up, NZD holds, & more

Here are the key things you need to know before you leave work today (or if you already work from home, before you shutdown your laptop).

MORTGAGE RATE CHANGES
Later yesterday the Cooperative Bank who have lowered their fixed rates for 3, 4 an 5 years fixed, taking their 5 year down below 6%. Today both BNZ, ASB and Kiwibank raised their floating rates in response to the Wednesday OCR change - but no others yet. BNZ's rise was +45 bps, ASB and Kiwibank's were by +50 bps. More here.

TERM DEPOSIT RATE CHANGES
Both BNZ and Kiwibank raised some savings or notice saver accounts, BNZ by +50 bps, Kiwibank by +35 bps. ASB has raised all its term deposit rates, but their one year rate is still lower than Kiwibank's 4.0%.

SINKING
House prices are now declining in all main urban districts according to the latest REINZ sales data, adjusted for properties by type.

THE WEALTH EFFECT IN REVERSE
Statistics New Zealand says household net worth has fallen for the first time in nearly three years, while Kiwis have been spending nearly every dollar of their income. Not only are they burning through their cash reserves now, the value of their housing assets is falling, as are the KiwiSaver balances, and equity portfolios.

CLIMATE CHANGE & INSURANCE
Tower CEO Blair Turnbull says reinsurers are questioning their down-under exposures and  he sees a risk of uninsurable areas in the future.

TACKLING WINTER & COMPLACENCY
In the face of increasing winter infections that are challenging hospitals and their staff, the Government is increasing access to antiviral medication to those most likely to end up in hospital, making free masks and RATs more widely available, and doing another push to lift uptake of flu and COVID-19 vaccines including the second booster.

CBD's NOT COMING BACK
The pandemic, flu and the attractiveness of working from home means CBDs are becoming less attractive. This is a global transition that just isn't going away. Rising yields and lower demand make the repricing of office buildings a grim prospect. The result will be much lower valuations for commercial offices and the retail that has been built around it. It also undermines the current pattern of public transport. Even 'free' won't save it and ridership isn't returning to pre-pandemic levels any time soon. Auckland Transport's May public transport patronage is down -20% from May 2021, and now only half of pre-pandemic levels.

AUSSIE JOBLESS RATE FALLS ON STRON P/T JOBS GROWTH
The Australian employed workforce rose by +88,000 in June, a bit more than half full-time jobs, and a surprising number were part-time. That took their unemployment rate down from 3.9% to 3.5% (a record low for them) and involved a small uptick in their participation rate. This lower than expected jobless rate will put pressure on the RBA to act harder and sooner. (The last time NZ reported its jobless rate, it was 3.2% in March. We get our June data on Wednesday, August 3, 2022. They are unlikely to change much given the strong jobs market here.)

SWAP RATES FIRM
Wholesale swap rates may have pushed on up firmly today, adding to yesterday's late rise. The 90 day bank bill rate was up +5 bps to 3.05% ahead of the OCR review. The Australian 10 year bond yield is now at 3.48% and up +4 bps from this time yesterday. The China 10 year bond rate is now at 2.83% and unchanged. And the NZ Government 10 year bond rate is now at 3.70%, up +6 bps from this time yesterday and now the same as the earlier RBNZ fix for this bond which was unchanged again at 3.70%. The UST 10 year is now at 2.96% and down -2 bps from this time yesterday.

EQUITY PRICES MIXED
The S&P500 ended its Wednesday session down -0.5%. Tokyo has opened up +0.6% in late morning trade. Hong Kong has opened up +0.2% in their early Thursday trade. Shanghai is up +0.1%. The ASX200 is up +0.4% in early afternoon trade. The NZX50 is also up +0.4% in late trade, led by PPH (+5.8%), FBU (+2.2%) and RYM (+1.8%).

GOLD FIRMS
In early Asian trade, gold is up +US$4 from this time yesterday, now at US$1730/oz.

NZD LITTLE-CHANGED AGAIN
The Kiwi dollar has had a minor slip from this time yesterday, now at 61.1 USc. Against the AUD we are virtually unchanged at 90.4 AUc. Against the euro we now just under 61 euro cents. That means our TWI-5 is little-changed at 70.4.

BITCOIN RISES
Bitcoin is now at US$20,273 and up +4.0% from this time yesterday. Volatility over the past 24 hours has been high at +/-3.9%.

This soil moisture chart is animated here.

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