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 changes to report.
TERM DEPOSIT RATE CHANGES
In addition to the small increases from Westpac which came in late yesterday, BNZ, TSB and HSBC also raised TD rates today. HSBC also raised its savings rate.
BRACE YOURSELF
On Wednesday, January 25, we will get the Q4-2023 CPI result. We already have the food price component (+11.3%), but the MBIE petrol price monitoring shows that this component will show a -11% drop from Q2, and a -5.3% drop from Q4-2021. It is not easy to imagine other costs that will have similarly declined. The RBNZ reckons overall prices will have risen. So do many analysts.
THEY ARE BACK - TO 62% OF 2019 LEVELS
According to the November data from Stats NZ, out today, there were 231,300 visitor arrivals in the month, a sharp increase from October (161,600). Of special note is that this is a recovery back to 2012 levels. The usual pattern is for this to rise by about +1300,000 to +150,000 in December. If we had anywhere near rise this year, that will be a significant boost to local spending. Tourist arrivals now exceed resident departures on vacation.
CAPITAL CLOSED
Just a reminder for those outside the region, Wellington is on holiday on Monday, their Anniversary Day.
HARD TO SEE IT AS TEMPORARY NOW
Japanese inflation hit a 41-year high in December, up +4% and above their central bank 2% target for a ninth straight month. It is up from +3.7% in November, the sharpest rise since 1981. Prices of electricity increased +21%, while grains rose +9.6%. Last year the overall level was up +2.3%, so a rising pace. "Core inflation" which excludes food, was also up +4.0%. The rise from November to December was at an annualised +3.5% rate, so perhaps there is some moderation coming.
UNCHANGED AGAIN
The Chinese central bank reviewed its loan benchmarks today and left them unchanged. This wasn't a surprise and is the fifth straight month they have been untouched. The one-year loan prime rate (LPR), which is used for corporate and household loans, was held at 3.65%; while the five-year rate, a reference for mortgages, was held at 4.30%. Lower mortgage rates are not inducing more house sales in their struggling housing markets, so a change would make no difference.
THE CHINESE TRAVEL BUG RETURNS
The gigantic Chinese New Year (Year of the Rabbit) travel event is starting, which will see more than 900 mln people move around internally and externally, probably extending Covid to every corner of their country. Some 2.1 bln trips are expected to take place during the 40-day Spring Festival period, double the number of treks from last year.
TREAT YOURSELF
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SWAP RATES RECOVER SOME
Wholesale swap rates were likely higher today after yesterday's sharpish retreat. The real action comes near the close however. Our chart will record the final positions. The 90 day bank bill rate is up +2 bps at 4.83%. The Australian 10 year bond yield is now at 3.39% and little-changed from this time yesterday. The China 10 year bond rate is at 2.95% and unchanged. The NZ Government 10 year bond rate is now at 4.02% and up a mere +1 bp, and still above the earlier RBNZ fix for the NZGB 10 year which is unchanged at the lower 3.99% level. The UST 10 year is up +3 bps to 3.40%. We should also note that negative yields have returned for Japanese 1yr and 2yr Govt bonds.
EQUITIES MOSTLY HIGHER
The S&P500 ended its Thursday session on Wall Street down -0.8%, and is down a net -2.5% so far this week. Tokyo has opened flat today and heading for a +2.2% weekly rise. Hong Kong has opened its Friday session up +1.1% pushing its weekly change to +0.4%. Shanghai is up +0.3% at its open and heading for a +1.6% weekly rise. The ASX200 is up +0.2% in afternoon trade and heading for a +1.7% gain. The NZX50 is up +1.1% today in late trade and heading for a +2.2% weekly rise and among the best of the equity markets we follow.
GOLD RISES
In early Asian trade, gold is up sharply, now at US$1930/oz and up +US$29 from this time yesterday.
NZD SLIPS MARGINALLY
The Kiwi dollar is little-changed than this time yesterday, now at 64.2 USc. But against the AUD we are -½c lower at 92.7 AUc. Against the euro we are also down -½c at 59.2 euro cents. That all means our TWI-5 is now at 71.2 and down just -10 bps since yesterday.
BITCOIN FIRMS
The bitcoin price is up +1.7% from this time yesterday at US$21,030. Volatility over the past 24 hours has been modest at +/- 1.3%.
QUOTES PLEASE
We are still keen to get suggestions from readers for additions to our "quotation" database. We have added about 50 in the past week (to 150), but we need many more. Either email me, or pop them into the Comment stream below. Thank you to everyone who have already responded.
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93 Comments
News - New Zealand Taxpayers' Union Inc.
Taxpayers spending at least $75 million per year on additional days off for public servants 🏖️💰
Over the break, our research revealed that public servants are receiving additional days of paid leave, beyond their statutory entitlements, amounting to more than $75 million per year!
In the year that’s been, taxpayers paid public servants for over 167,000 days that they weren’t even at work, excluding the normal four weeks leave and public holidays. It’s a struggle to believe that public servants are working so much harder than the non-government workers who pay their salaries that they need all this additional time off.
While the money spent could have paid for 1,000 extra nurses, instead it was wasted paying a whopping 457 years' worth of leave total for bureaucrats to sit at home.
We fear how high the total number of extra leave days may be, as the data we obtained only account for 36,400 members of the public service when we know there are more than 60,000 employees. Almost all public servants receive an additional three ‘department days’, but some public servants are receiving up to 30 additional days annual leave, which is absolutely ridiculous. We are calling for leave entitlement to be brought in line with the private sector.
Jordan was interviewed on Newstalk ZB about the findings. Click here to listen.
I'd suggest you (and they) are massively disconnected from the Corporate employment market.
Most government employees are candidates for corporate employment also.
If you offer 20 days A/L, and 5 days S/L, you won't attract any talent.
If you think the public service is bad now, the last thing we want to do is make them a less compelling option for talent....
Dreaming. She will be more of a hag when she is older than she is now. Most young people now have cottoned on to what she is, many have shifted to ACT as a result. The youngsters of the future won’t hitch their future to some washed up has been. Hopefully their parents would have brought them up better than that.
No that is not acceptable. In the beginning I was prepared to believe that she was sincere and candid. In that, from my point of view, I believe I was mistaken. But nonetheless, the lady herself held the position of prime minister of our nation and did so by dint of a fair democratic process. In that aspect, attacking her personally and malevolently, is inexcusable and amounts to nothing more than an attempted degradation of New Zealand’s sovereignty. She is gone now. That on its own is sufficient for me.
... my wife met John Key once ... she said he is the nicest , most friendly , engaging guy ... but ... pretty darn useless in his role as PM ...
That's how I feel about Jacinda Ardern ...
... but , credit where it's due , she was brilliant overseas , great at pushing the NZ story ... far far better as our unofficial foreign minister than the actual one was ( Nanaia Mahuta ! ) ...
Own doing undoubtedly. Mr Malprass in Stuff records that the Maori caucus of the Labour party is meeting tomorrow exclusively, to discuss their position. Hang on , is this not a party, united, and in solidarity? So how come issues as such are to be decided selectively on the form of race? I would suggest the very nature of a meeting on that basis is exactly what the electorate regards as being subjective, divisive and undemocratic and indicates that Labour itself, has no real idea of how, where and why things have gone so wrong.
And because viruses get more virulent and less deadly over time (omicron variants are a lot less deadly than Alpha/Delta variants). Think about it, they want their hosts to live for as long as possible to pass themselves onto as many people as possible. Plus we build up immunity the more exposure we get.
The angry mob doesn't let facts get in the way of their pitch forks, hence their continued vitriol.
It is not easy to imagine other costs that will have similarly declined. The RBNZ reckons overall prices will have risen. So do many analysts.
I'm expecting inflation to be in the region of 7.5%. We are still only in the first round of the fight against inflation in New Zealand, no one binged in the cheap money era more than we did.
I'm still confused by that food price inflation figure. I finally thought food prices (especially vegetables) had stabilised or even gone down: lettuces, tomatoes, etc.
But unfortunately I have noticed inflation has finally increased the "normal" price of the beer I drink (where the normal price is the special price as it is on special every second week so I stock up).
Countdown are possibly hamstrung by being centrally distributed. Their produce is purchased nationally and distributed out of the main centres, whereas Pak N Save/New World are franchise owned, and their owners are able to source local produce. So a lot cheaper depending on region and less food miles.
Better living everyone.
Food price inflation chain thoughts - suppllers to supermarkets, at least major ones, most likely get a chance monthly or quarterly to change prices. Price increases are thought through months in advance so if people believe the price increases are in the main past they need to think again. The impacts of wage increases and other factors mean we are going to get price increases for some time. The level of them and the frequency may (big may) diminish but inflation has a way to play out so good luck trying to make sense of the reasons behind them
Japanese inflation hit a 41-year high in December, up +4% and above their central bank 2% target for a ninth straight month.
If this continues and the BoJ changes course with the change in leadership (March I believe), we're in for major disruption. This will be a global game changer. Hoping that the Fed and the BoJ work together.
Uncle Tony (Alexander) puts on his DGM hat but reckons 'she'll be right' by mid-24 while admitting that he's a failure at predictions.
https://www.macrobusiness.com.au/2023/01/reserve-bank-sends-house-price…
Prepare for the Wolf in sheep clothing (someone or something that seems to be good but is actually not good at all. The twin National/Act platform is bad news for the senior and pension consumer, nothing progressive about these 2, throwbacks to earlier decades, one with a cheesy smile, the other a clone of Key without the charm, both full of one-line rhetoric and nonsensical policy assumptions, all to increase wealth for the top 10%.Seymour in 2016 said" All of the evidence suggests that you get a much higher return investing in younger people rather than older people." Both these guys, one with a flag for the Roman Catholic faith, though not attending church on a regular basis, the other a zealot are to be avoided.
Buckle up buttercup because National/Act are what's in store for you after the election. To be honest by the time you are a pensioner it shouldn't matter who is in power because you have had a lifetime to become independent from all the fools that pass through politics.
After however many years of watching various governments I'm not sure either 'grow' the economy more than the other. It's just that National tends to send a signal of 'go for your life' whereas Labour send a signal of 'we're going to make business harder and more expensive for you to do'.
We should also note that negative yields have returned for Japanese 1yr and 2yr Govt bonds.
Japanese exports up only 11.5% y/y by value in Dec, worst since last January. By volume, exports down 8%. BoJ isn't going to be raising rates because global recession is striking the economy inside and out. Link
Can someone explain the implications of Japanese inflation to the global economy? I'm guessing as local rates and bond yeilds rise yen invested globally will be called home leaving a scenario possibly similar to the Weimer Republic in a worse case scenario?
Yes. Not sure what Weimar has to do with it though. Remember that Japan is a creditor nation. They're the largest holder of U.S. debt globally. Ask yourself what happens if Japan unwinds that debt.
https://www.oneroof.co.nz/news/42932
So apparently Jacinda leaving will mean house prices go up. Yet when Labour introduced all of these measures the same low-lives said it wouldn't make property prices go down. If anyone can vote National after reading that then they have no conscience whatsoever.
“His list of impacts the Labour Government had on the property market, particularly investors, is long: "The relentless persecution of ma-and-pa investors; the threat of capital gains tax; the change of the bright-line rules; banning of foreign buyers; the empowerment of tenants over landlords; the description of ma-and-pa investors as rampant speculators.”
All great things IMO. Poor ma and pop that have made millions in tax free capital gains boo hoo. Vote in National and we can all got rich selling houses to each other again.
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