A review of things you need to know before you sign off on Tuesday; ASB raises TD rates, REINZ November data weak, food prices high, IRD watching ESSTs, insurance stress rising, migration rules eased, swaps firm, NZD firm, & 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
Unity Money raised rates today.

TERM DEPOSIT RATE CHANGES
ASB has raised term deposit rates today, shifting their offer to the top of what their rivals offer.

BELEAGUERED MARKET SHIFTS LOWER
Not a very merry Christmas for the real estate industry was revealed today in the REINZ data for November as sales sink to a 12 year low driven by a lack of demand that caused prices to tumble and inventory soar. The declines are intensifying with the median price now down -$112,000 or -12% over the past year. In Auckland the decline average -18% across the whole city, a fall in the median price by -$235,000. QV data suggests prices are falling at the rate of $1260/week.

FOOD PRICES HIT 14 YEAR HIGH
Food prices rose by +10.7% over the past year to November, the highest year-on-year rise since the +10.9% rise in September 2008. Prior to that, this is the highest since April 1990 which was 32 years ago. Along with rent, food prices make up about 30% of CPI inflation.

YOU USE ESST? YOU ARE IN BIG TROUBLE
The IRD has issued a new Revenue Alert warning of severe consequences for anyone who has or uses Electronic Suppression Software Tools (ESST) to try to evade tax. They say ESS tools pose a "significant threat to the integrity of the tax system". They will want to make an example of someone. ESS tools are software programs, devices, or other tools that systematically alter point of-sale data collected by a business. The software provides a means to understate or completely conceal revenues, which facilitates tax evasion. In Australia, their crackdown involves police raids. Other jurisdictions are raising the alarm too, including the US and Canada.

MOOLA COLLAPSE UPDATE
The first liquidator's report on the collapse of high-cost lender Moola and NZ Fintech is out. While it doesn't disclose much yet, it is clear that creditors will likely lose substantially. All up, ten group companies are being liquidated. The liquidators are looking to sell the Moola and Zooma loan books. Liquidator sales (and at Christmas) are often at steep discounts.

INSURANCE STRESS RISES QUICKLY
The rising cost of house insurance is concerning many New Zealanders. A recent survey by Consumer NZ found half of respondents were worried about the cost of insuring their homes. Alarmingly, 7% of people without house insurance either cancelled or didn’t renew their policy because of cost. For those without contents insurance, 17% didn’t renew their policy for that same reason.

ANOTHER SELL-DOWN
Fonterra and Nestlé today agreed the sale of their Dairy Partners Americas (DPA) Brazil joint venture to French dairy company Lactalis for about $210 mln. The deal is expected to be completed by mid-2023, subject to regulatory authority approvals. Fonterra owned 51%, Nestlé 49%. Fonterra didn't provide details about how this will affect their financials, although Fonterra's CEO said the money will used to pay down debt, and "given the asset has been held for sale since 2020 there will be little cash impact on Fonterra’s earnings."

TEN PERCENT TO RETIRE
Six of the Government’s 64 MPs will retire at the 2023 election. Ministers Poto Williams (Conservation & Disability), Aupito William Sio (Courts) and David Clark (Commerce) will retire, along with MPs Jamie Strange, Marja Lubeck and Paul Eagle. All will stay in parliament until the election.

MIGRATION SETTINGS EASED AGAIN
The Government has expanded its 'green list' for work-to-residency visas to include nurses, construction workers and teachers. And it has expanded its straight-to-residency visa list to include midwives and auditors.

WESTPAC ESCHEWS THE INTERNAL CANDIDATE
Westpac has appointed Kelly Eckhold as its new Chief Economist in New Zealand. Eckhold had a long career at the RBNZ (interrupted by a stint at the Bank of England), and for the past 11 years has been at the IMF in Washington DC. He replaces Michael Gordon who has been holding the role on an 'acting-' basis since Dominick Stephens departed for a Deputy Secretary role at Treasury.

UP & RUNNING
MUFG Bank said it now has its first client for the bank’s Green Deposits product in New Zealand. With tenors that range from 1 to 12 months, the Green Deposits product is the first of its kind available in Australian Dollar, New Zealand Dollar and US Dollar for the New Zealand market. The new product has been designed to assist MUFG’s commercial and corporate clients in meeting their environmental objectives. Green Deposits allow customers to place term deposits with the Bank, which are in turn used to fund qualifying Green Loans for key projects in clean transportation, green buildings, energy efficiency and sustainable water/wastewater management projects, and notably, the New Zealand forestry and power renewable energy generation sectors.

CROOKED BUSINESSES CAN'T BE SHUT DOWN
Casinos are magnets for illegal behaviour, and in some cases a permitting agency for it. But despite egregious infringement, no government ever finds standards breached that would cause its license to operate be withdrawn. In Australia, the Queensland Government levied a $100 mln penalty for some amazingly serious breaches by the Star Casino company. But their facilities will remain open. And ASIC is suing 11 senior present or past directors and managers alleging they approved the expansion of Star’s relationship with certain individuals with reported criminal links, rather than addressing money laundering risk by inquiring into whether Star should be dealing with them. Recall, SkyCity has also been sanctioned at their Adelaide casino. Crown and Star have been levied huge fines in Sydney, Victoria and Perth. None have ever lost their license.

GOING SOFT
In Australia, their auction clearance rates are falling too, although at 58%, our markets would regard that as still high. For them it is their lowest in five months after a record 2667 homes were taken to auction. It comes as Aussie house prices are falling, although not as fast as they are here

SWAP RATES FIRMER
Wholesale swap rates were likely firmer again today. The real action comes near the close however. Our chart will record the final positions. The 90 day bank bill rate is unchanged at 4.51%. The Australian 10 year bond yield is now at 3.41% and up +3 bps from this time yesterday. The China 10 year bond rate is at 2.94% and up +1 bp. The NZ Government 10 year bond rate is now at 4.18%, and up another +3 bps and still well above the earlier RBNZ fix for the NZGB 10 year which was up +2 bps to 4.11%. The UST 10 year is now at 3.60% and up +1 bp from this time yesterday.

EQUITIES TURN POSITIVE
Wall Street came home with full sails. The S&P500 ended its Monday session up +1.4% with a late surge. Tokyo has opened up +0.5%. Hong Kong has opened little-changed as has Shanghai. The ASX200 is up +0.4% in early afternoon trade. The NZX50 is up +0.5% in late trade.

GOLD SLIPS
In early Asian trade, gold is at US$1783/oz and down another -US$8 from this time yesterday.

NZD FIRM
The Kiwi dollar is marginally firmer from this time yesterday, now at 64 USc. Against the AUD we are also firm at 94.6 AUc. Against the euro we dipped slightly to 60.6 euro cents. That all means our TWI-5 is now up fractionally at 72.5.

BITCOIN FIRMS
The bitcoin prices is up +1.3% to US$17,162. Volatility over the past 24 hours has been modest at +/- 1.1%. And the boss of collapsed FTX has now been arrested by US authorities.

This soil moisture chart is animated here.

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