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
No more changes to report today. Only Kiwibank has signaled OCR-related changes so far.
TERM DEPOSIT RATE CHANGES
No changes to report here either.
PERSONAL LOAN RATES
Unity Money raised the top range of their secured personal loan rates, and all their unsecured personal loan rates.
STATING THE OBVIOUS
A Government working group concludes that falling interest rates and restricted land supply are largely responsible for high house prices.
RECORD RESULT
Kiwibank's annual profit rose +4% to $131 mln as net interest income grows strongly and lending grows faster than overall market growth. (GDS here.) Total assets are now $31.5 bln. Kiwibank is the smallest of the main banks. (For perspective, the recent ASB result reported a profit of $1.471 bln, an +11% increase on total assets of $121.5 (up +7.9%).
"RELIEF" - BY TAKING ON MORE DEBT
ASB is offering storm-affected victims in the upper South Island 'relief packages' - but some aspects involve customers borrowing more. This includes the option to suspend home loan principal repayments for up to three months (interest will be compounded however), an overdraft of up to $10,000 for ASB home loan customers and up to $2,000 for other ASB personal customers, or other tailored solutions depending on the customer’s circumstances, and "tailored solutions for eligible ASB business and rural customers including access to working capital of up to $100,000". They will waive the penalty for any customer wanting to break a term deposits. Details here. Update: Westpac is offering a relief package too.
MARSDEN POINT GOING GREEN
Channel Infrastructure (ex-NZ Refining, the operator of the Marsden Point facility) is out looking to convert its own energy needs to one based on solar energy.
HIGH ON THE GLOBAL LIST
In the latest Rabobank ranking, Fonterra grew revenues by +8.8% in 2021 to US$14.8 bln, and that enabled it to hold on to its sixth place global ranking among all dairy companies. Fifth on this list is Yili, which includes Westland Dairy, and Oceania Dairy in New Zealand, and they grew revenues by +32% largely due to acquisitions. Interestingly, four of the top 20 are French companies, including world #1 Lactalis (privately owned) (up +16%). Germany, the Netherlands, and China each have two on this list.
HIGH DEMAND, HIGHER YIELDS
There was high demand in today's NZ Government bond tenders where $400 mln was on offer and 34 or 95 bids won something. The May 2026 $200 mln was the most popular, going for a yield of 3.47%, up from 3.27% at the prior even two weeks ago. The April 2029 $150 mln went for 3.46%, up from th epeior 3.29%. And the May 2051 $50 mln went for 3.95%, up from 3.76% two weeks ago.
A 48 YEAR LOW
In Australia, their July labour market stats show a jobless rate that dropped to 3.4% s.a. from 3.5% as a further 20,000 people moved out of unemployment (3.3% actual). And that was despite their employed labour force shrinking unexpectedly by -41,000 in the month. (New Zealand's June jobless rate was 3.2% actual.) Australia's participation rate is 66.4%; New Zealand's is 70.5%.
SWAP RATES FIRMER
Wholesale swap rates are probably firmer again today after the RBNZ decisions and especially the US Fed minutes. The 90 day bank bill rate was up +4 bps to 3.35% ahead of today's OCR review. The Australian 10 year bond yield is now at 3.36% and up +7 bps since this time yesterday. The China 10 year bond rate is at 2.65% and another -1 bp slip and a two year low. The NZ Government 10 year bond rate is now at 3.50%, up another +6 bps from this time yesterday, and now below the earlier RBNZ fix for this bond which was up a very sharp +12 bps at 3.52%. The UST 10 year is now at 2.88% and up +10 bps from this time yesterday.
EQUITIES LOWER
The S&P500 ended its Wednesday Wall Street session down -0.7%. Tokyo has opened its Thursday session back down -0.8%. Hong Kong has fallen -0.6% and Shanghai is also down -0.6% in early trade. The ASX200 is down -0.3% in early afternoon trade. And the NZX50 is also down -0.3%.
GOLD SLIPS
In early Asian trade, gold fallen -US$15 to US$1,762/oz.
NZD RETREATS
The Kiwi dollar is lower at 62.8 USc falling -¾c from the OCR. Against the AUD we are softish at 90.6 AUc. Against the euro we are also -¾c softer at 61.7 euro cents. That means our TWI-5 is now at 71.3 and down -80 bps.
BITCOIN FALLS
Bitcoin is fell -2.4% from this time yesterday to US$23,430. Volatility over the past 24 hours has been moderate at just on +/- 2.7%.
Daily exchange rates
Select chart tabs
Daily swap rates
Select chart tabs
This soil moisture chart is animated here.
Keep abreast of upcoming events by following our Economic Calendar here ».
30 Comments
Kiwi Bank profitable. Well, yes. But said profit overshadowed massively by the others, based on the west side of the Tasman. Still Jim Anderton would undoubtedly feel vindicated for his venture. Pity though that the government of the other Jim as in Bolger didn’t have the mettle to bail out the BNZ. There would have been much more merit in that then, than the subsequent bail out of AirNZ one might suggest. Then again there were skeletons & scandals in the BNZ vaults aplenty. One day Winston Peters might include a chapter on that in his memoirs as after all, it provided both reason & catalyst for him to leave National & form NZF. Whoever said banking was dull.
What's your point here?
30% of the special character area is being rezoned, and across Auckland more than a million potential new homes are being enabled by the plan change.
Following the plan change, I think something like 2 million new homes will be enabled by the unitary plan, projections show we need about 300,000 over the next 30 years...
You may not value the character areas, that's fair enough, you are entitled to your opinion. But many Aucklanders, including myself, do.
Surely a balance should be struck, and has been struck.
The problem is that most of the special character area is also the best area for high density housing. I think those areas look really nice, but that seems like a much lower priority than homelessness, car dependence, etc. building high density in the burbs to keep the heritage near the centre is a bad outcome for all except the relatively small number of people that get to live there.
No. It will get built. People will pay $1.5-$2 million for two bedroom townhouses in Ponsonby.
We don't need more expensive housing for rich people, at the expense of our built heritage.
What we DO need is much more mid-cost housing, and the places that will be realised is places in lower land value locations near train stations. Think Avondale, Morningside, New Lynn etc.
Also, in this remote working era, there's less argument for lots of density near one major centre (ie. the Auckland CBD).
The central burbs are expensive as because of scarcity.
Infill it, remove the "exclusivity", make it cheaper, reduce commute times. Seems kinda dumb there's this ring around central Auckland that people are wanting to protect, when it's the most logical place to have high density.
Unbelievable they cannot be repaired quickly, seriously chuck some gravel in it, hit it with a compactor and seal it, but no we have people down here going about with spray cans and just marking and recording them instead. Must cost next to nothing to fix, you toast a factory alloy and a tire and thats a couple of thousand dollars. Imagine hitting that on a motorbike.
Well now, that has put a rat amongst the hens hasn’t it. And I don’t mean to say, the former is the protagonist here. Quite the opposite, in fact. In this case here, the ratting, so to speak, is self created by a clandestine body that wasn’t an official caucus because the individual that was being ratted on was excluded from said caucus. The official caucus was the next day, once all and sundry had been orchestrated, the subject was to be ratted on and ousted formally. What a bloody 🐀’s nest.
This is more like a J-L Ross scenario methinks. Except the identity here is highly educated, qualified articulate and is appearing primarily, rather than any self interest, but on behalf of his constituents, and all New Zealanders, as an elected MP. This is a wind of fresh air and if I was in his electorate I would be voting for him regardless of needing to be attached to any blasted self serving political party.
It certainly is a breath of fresh air.
I'm not surprised by his accusations at all. I haven't worked in parliament, but I've worked on contract for ministries, and bullying is rife in them. Also, by doing some work for ministries, I occasionally got a sneak peak into parliament, and heard things suggestive of a bullying culture.
But don't worry, Labour would never have an environment like, because they are so nice and kind. Be Kind!!!
RBNZ now predicting up to a 20% fall in house prices.
Have ANZ changed their mind again, it must be about time, they've changed their forecasts about 3 or 4 times in the past 9 months.
https://www.stuff.co.nz/business/129614815/reserve-bank-now-predicting-…
We welcome your comments below. If you are not already registered, please register to comment.
Remember we welcome robust, respectful and insightful debate. We don't welcome abusive or defamatory comments and will de-register those repeatedly making such comments. Our current comment policy is here.