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
In case holidaying/cleaning up Aucklanders missed it on Monday Kiwibank has reduced its two year fixed rate to 6.49%, the lowest of the main banks for this term. It also raised its one year fixed rate to 6.49%, matching BNZ and wth TSB at 6.29%.
Among credit unions, Unity also cut its two year fixed rate to 6.49%. Its one year rate is 6.39%
Among non-bank lenders, Basecorp Finance raised its standard floating rate to 8.7%.
In business rates, ANZ has raised its key lending base rates by 40 bp.
TERM DEPOSIT RATE CHANGES
And again, among the things you might have missed on Monday, Kiwibank raised some term deposit rates out to a 12 month term, mostly by +10 or +15 bps. First Credit Union also raised rates. And SBS Bank raised rates, but left its hot 6% one year rate unchanged (it cut its 9 month rate, however).
AUSSIE RETAIL SALES HAVE SHOCK FALL
Australian retail sales slumped 3.9% in December, recording their first drop for 2022 and surprising markets, resulting in weakening wholesale interest rates and a falling currency. ANZ economists said although strong Black Friday sales and a shift to travel spending in late 2022 put downward pressure on December retail sales, "the extent of the fall suggests households have started to cut back on discretionary spending".
NZ MORTGAGE GROWTH SLOWEST IN NEARLY 10 YEARS
New Reserve Bank figures show the stock of outstanding mortgages in the country rose by just $1.1 billion in December - a far cry from the $3 billion-plus figures recorded during the 2020-21 boom. What it means is the annual growth rate for the mortgage pile is continuing to slip, now down to 4.4%, which is the lowest since February 2013. A year ago the growth rate was at 10.5%. Business and agriculture lending both declined in December.
TERM DEPOSIT SAVINGS ROCKET TO NEW HIGH
The were dead, then they came back. What a difference interest rate rises will make. New deposit figures from RBNZ show that household term deposits increased by a whopping $3.737 billion in December, with the total in term deposits now hitting a new record high of $104.987 billion. That's up $21.7 billion, or 26% in the past 12 months. RBNZ said total household deposits increased by $1.9 billion in December to $228.2 billion. Transaction and savings account balances both fell.
CLAIMS COME RUSHING IN
The country's largest insurer IAG said as of Monday it had received more than 5,000 claims across its AMI, State and NZI brands relating to Friday's Auckland flooding. It expects the number of claims to rise further over the coming days, with the event still unfolding and as customers identify damage to their property. Fellow insurer Tower said as of Monday it had received approximately 1,900 claims for this event. Of these around 1,000 are house claims and the remainder are motor and contents claims. It too expects to receive further claims as customers assess their damage. Both insurers say they have substantial reinsurance arrangements in place.
CONSTRUCTION CONSTIPATION
And further to the floods, with a warning that construction projects may be delayed for several months as civil contractors prioritise emergency flood repair work, while Westpac is warning construction costs will stay high as a result of increased demand triggered by Auckland’s storm.
MORE MORTGAGE MARKET MALAISE
Oh, how times change. Two Decembers ago we saw a new record high mortgage advances for a month (subsequently surpassed in March 2021) of over $9.6 billion. In December 2022 little more than $5 billion was advanced - the slowest December in five years.
LABOUR'S LEADERSHIP SHUFFLE BOUNCE
Polls from 1News/Kantar and Newshub/Reid Research out on Monday night both showed support for Labour bounced back to just in front of National, with new Prime Minister Chris Hipkins immediately jumping above National Leader Christopher Luxon as preferred Prime Minister.
MIGRANTS MAKING MOVES
Migrants accounted for more than 10% of New Zealand home purchases last year.
SWAP RATES FIRMER
Wholesale swap rates likely firmed today. The real action comes near the close however. Our chart will record the final positions. The 90 day bank bill rate is up +3 bp at 4.94%. The Australian 10 year bond yield is now at 3.54%, down 2 bp. The China 10 year bond rate is at 3.003%, plus 6 bp. The NZ Government 10 year bond rate is now at 4.208% and up 5 bp. The UST 10 year is down 1 bp to 3.54%.
EQUITIES MIXED
The NZX50 has slipped 0.1%. The ASX200 has started up 0.2% in early afternoon trade. Tokyo is unchanged 0.1%, but Hong Kong is having something of an early lift after Monday's Alibaba-rumour-fuelled 2.7% slump, although it has weakened in recent minutes. It was up 0.1% a short time ago. Shanghai opened up barely changed, edging down very slightly.
GOLD EDGES HIGHER
In early Asian trade, gold is now moving marginally higher, at US$1925/oz, though that is down about US$1 from this morning.
NZD MIXED
The Kiwi dollar is 64.7 USc, down from 64.9 earlier Tuesday. Against the weaker Aussie (on the back of those shock retail sales figures) we are at 91.8 AUc, that's up from earlier by nearly half an Aussie cent. Against the euro we are down slightly at 59.6 euro cents. The TWI is 71.47.
BITCOIN SOFTENS
The bitcoin price has softened in the past 24 hours, though was rallying a little at time of writing to be around US$22,900 and down a little under 3.2% in the past day.
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