A review of things you need to know before you sign off on Thursday; few retail rate changes, GDP surges, surveys not positive, more dishonesty revealed, swaps leap, 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
TSB and the Police Credit Union raised fixed rates today.

TERM DEPOSIT RATE CHANGES
TSB and the Police Credit Union also raised term deposit rates, and they were joined by Unity Money.

MORE BETTER DATA
Like most (non-real estate) data we have been getting recently, today's Q3-2022 economic activity data was stronger than either analysts or the commentariat had expected. Not only is real GDP higher than year ago levels by an impressive +6.55%, the Q2-2022 data was revised up as well. Nominal economic activity (GDP) rose to $373.5 bln in the year to September and the July-September activity was more than $97 bln. Both were all-time records. But it is the inflation-adjusted 'real' results that are eye-catching. On a per-capita basis, the +2.0% 'real' improvement returns that expansion to pre-Covid levels. All of this paints a picture of a 2022 economy that has done better than many were expecting, economists included.

SALES INCH UP, WAGES JUMP
The latest Xero Small Business Index reveals weakening annual sales growth for New Zealand’s small business sector in November, ahead of the Christmas and summer break. They report that sales grew +2.3% year-on-year, down from +10.0% in October and the lowest since September 2021. While sales weakened, wages grew +6.6% in November 2022, the second consecutive month of acceleration as wage growth nears the previous record high of +6.7% in June 2022.

'NOT DELIBERATE OR DISHONEST'
The Real Estate Agents Disciplinary Tribunal has censured two agents for misconduct for inserting the signatures and initials of vendors taken from previous documents onto a new offer and failing to obtain the parties’ actual signatures on the contract. In its decision the Tribunal noted the conduct was “not a deliberate or dishonest act of forgery” but constituted seriously negligent or incompetent real estate agency work.

DELIBERATE AND DISHONEST
Two couples looking to get into property investing in Auckland used fake employment agreements to defraud banks out of $8.7 mln. Bryan Martin and Joshua Grant were found guilty on charges of obtaining by deception following a six-week Auckland District Court trial in August and September of this year. Grant’s wife, Sian Grant, and Martin’s former partner, Viki Cotter, have both previously pleaded guilty to their part in the scheme. Both couples sought to invest in the Auckland property market, however did not have the income needed to secure loans. They made document up.

PROPERTY SENTIMENT FALLS AMONG THE PROS
Property sentiment edged lower in the December quarterly ANZ-Property Council survey and is now back below pre-pandemic levels. Both residential and commercial property sentiment fell. Interest rates, access to finance and rising costs are weighing on sentiment, they note.

LOWER WELL-BEING, BUT AT LEAST THE COMMITMENT TO THE BANK ARE BEING MET
A Roy Morgan survey of 7000 people commissioned by ANZ has found that a majority of people are staying on top of day to day financial commitments and keeping up their KiwiSaver contributions, despite uncertainty about the economic outlook. From the responses they derive The ANZ Financial Wellbeing Indicator which shows some steady declines, and was 59.7 out of 100 in the three months to September 30. That compares to 59.9 in the June quarter and 62.3 in the September 2021 quarter. However, when it came to the ‘meeting commitments’ component the number has risen, sitting at 72.9 in the latest report, up from 71.9 in the June quarter.

'SYSTEMIC FAILINGS'
The FMA has formally warned Pencarrow Private Equity Management for breaching record-keeping requirements under AML/CFT requirements. But the warnings relate to activity in 2018.

AUSSIE LABOUR MARKET STRENGTH
A higher participation rates is powering the Aussie labour market, whose jobless rate stayed at 3.4% in November. Their jobless fell by -7,400 to 491,700. Total employment increased by +64,000 to a fresh record peak of 13.8 mln, beating market forecasts of a rise of +19,000, as full-time employment rose +34,200 to 9.6 mln while part-time employment gained +29,800 to 4.2 mln. Yes, 30% of jobs there are part-time roles. Surging inward migration is boosting this labour market. Willing workers are finding willing employers. Their participation rate edged up to 66.8%, returning to the record high hit in June.

CHINA RELEASES WEAK ECONOMIC DATA
There was a set of official data released in China today, much of it weak. Retail sales fell and by much more than anticipated, to be a massive -5.9% below year-ago levels in October. Given their pervasive lockdowns, analysts had though a massive -3.7% fall was coming. In fact it was almost twice that. Electricity production was unchanged in November from a year ago. But they claimed industrial production rose +2.2% on the same basis even though that was half the claimed October rise. It hardly makes sense when electricity use is unchanged. They also said house prices fell -1.6% in November from a year ago, a brave estimate when these markets are largely a shadow of themselves.

SWAP RATES LEAP
Wholesale swap rates were likely sharply higher today. Swap rates could be as much as +15 bps higher today. The real action comes near the close however. Our chart will record the final positions. The 90 day bank bill rate is up +1 bp at 4.53%. The Australian 10 year bond yield is now at 3.43% and up +7 bps from this time yesterday. The China 10 year bond rate is at 2.91% and down -3 bps. The NZ Government 10 year bond rate is now at 4.31%, and up +13 bps and still well above the earlier RBNZ fix for the NZGB 10 year which was up +6 bps to 4.20% with clearly some catching up to do. The UST 10 year is now at 3.50% and unchanged from this time yesterday, although it surged somewhat after the US Fed announcement before quickly reverting.

EQUITIES MOSTLY NEGATIVE, NZX THE EXCEPTION
Wall Street was roiled by the US Fed's hawkish position today, and ended down -0.6% in its Wednesday trade. Tokyo has opened down -0.2%. Hong Kong has opened down -1.9% in early trade. Shanghai is down -0.3%. The ASX200 is down -0.5% in Thursday afternoon trade. The NZX50 is on the positive side, up +0.1%, a small gain but it is unusual among the markets we follow.

GOLD UP
In early Asian trade, gold is just under US$1800/oz and up another +US$11 from this time yesterday.

NZD STAYS FIRM
The Kiwi dollar is little-changed from this time yesterday, now back at 64.6 USc after dipping sharpish on the US Fed rate change. Against the AUD we are softer at 94.1 AUc. Against the euro we are little-changed at 60.5 euro cents. That all means our TWI-5 is now down fractionally at 72.5.

BITCOIN UNCHANGED
The bitcoin prices is virtually unchanged US$17,794 despite some wild but short swings in between. Volatility over the past 24 hours has been moderate at +/- 2.0%.

This soil moisture chart is animated here.

Keep abreast of upcoming events by following our Economic Calendar here ».