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
ANZ has trimmed their 6 month and 1 year fixed rates by -4 bps and -9 bps respectively, taking their one year rate down to 6.74%.
TERM DEPOSIT/SAVINGS RATE CHANGES
TSB has launched a 6% one year TD offer. See here. Kiwibank has raised rates to nine months. It's new six month rate is 5.45%. and 5.50% for nine months. BNZ has raised most rates to 18 months but cut them from three years and longer. BNZ's six month rate is now 5.50% and their 1 year rate 5.70%.
UNDERWHELMING
The manufacturing sector experienced another decline in activity during April, according to the latest BNZ-BusinessNZ PMI. That is less-worse than in March and that is about the best you can say about this survey. But remember, the March services sector expanded at a good rate. The April services PSI will come out on early next week.
SLOWING? OR SEASONAL?
There was a significant decline in the number of people arriving in the country on work visas in April. The latest figures from MBIE show 15,873 people arrived in NZ on work visas in April, down by -22% compared to the 20,442 that arrived in March. That brought an end to the steady increase in overseas workers arriving since March last year.
EASING OFF?
The RBNZ's latest survey M14 showed that expectations for inflation over the next few years have dropped back as actual inflation has started to ease (See the note on petrol prices below.) More here.
SLASH REPORT COMPLETED
The Report of the Ministerial Inquiry into woody debris (including forestry slash) and sediment in Tairāwhiti/Gisborne and Wairoa has today been presented to the two lead ministers, David Parker and Peeni Henare. “The impact of slash on the East Coast communities has been devastating. More than 10,000 Tairāwhiti people petitioned for land use to be better managed. This report responds to that call,” Parker said. Federated Farmers wants the Government to move quickly to implement it, unlike the last report on the same matter.
MORE 5G ROLLOUT TO REGIONAL TOWNS
The Government has struck deals with the three major telecom network operators – Spark, 2Degrees and One New Zealand – which will deliver a faster roll-out of 5G services to around 55 rural and regional towns and provide mobile wireless coverage to further rural black spot areas.
SURVEY CONFIRMS SURVEYERS VIEWS
Lobby group Consumer NZ says a survey they ran found that trust in banks is dipping, with 39% of those surveyed stating they do not trust banks. This is the highest level of distrust since Consumer began tracking sentiment in June 2021. They also say banking customers are also expressing frustration with how much they are being charged in bank fees.
CHINA & INDIA TOURISTS START TO ARRIVE AGAIN
Foreign tourist arrivals rebounded to 69% of pre-pandemic (2019) levels in February, arresting the drop-off in the recovery over the past two months. The lift was supported by an improving recovery across selected Asian markets. Arrivals from India surged to 136% of pre-pandemic levels in March, and the recovery of arrivals from China lifted from 8% of pre-pandemic levels in February to 17% in March. Similarly, Hong Kong tourist arrivals lifted from 18% of pre-pandemic levels in February to 50%. The recovery in Australian tourist arrivals remained fairly stagnant, lifting one percentage point from February to 78% of pre-pandemic levels. H/T Infometrics
CARBON PRICE SINKS FURTHER
The NZ carbon price has sunk to $52.50/NZU today, its lowest since September 2021, a twenty month low.
BIG MOVEMENTS IN THE RBNZ SETTLEMENT ACCOUNTS
The April Settlement Accounts at the RBNZ show the the Crown balance halved in the month going from $35.8 bln to just $17.4 bln. But going the other way, the banks' accounts with the RBNZ rose from $45.8 bln in March to $54.7 bln in April. That is close to the record high balance of $56.4 bln in December 2022. These balances earn interest at the OCR of 5.25% pa. (But banks could choose to invest these balances elsewhere like the Sovereign bond market if they wished although it seems unlikely the interest yield earned would be quite as high.)
SAME AS FIVE YEARS AGO
The falling crude oil price is being broadly matched at the pump. Basically pump prices are now back to September 2021 levels, levels we first experienced in October 2018. The year-on-year fall in petrol prices is substantial and will help reduce the inflation rate.
Support us by going ad-free. Find out more.
SWAP RATES SOFT AGAIN
Wholesale swap rates are probably a softer yet again today on international influences. However, the real action in swap rates comes near the close. Our chart will record the final positions. The 90 day bank bill rate is down -1 bp at 5.60% and 35 bps above the OCR. The Australian 10 year bond yield is now at 3.32% and down a chunky -10 bps from this time yesterday. The China 10 year bond rate is up +2 bps at 2.73%. And the NZ Government 10 year bond rate is now at 4.06% which is also down -10 bps from yesterday, and now lower than the earlier RBNZ fix at 4.08% which down -4 bps from yesterday. The UST 10 year yield is now at 3.38% and down another -5 bps from this time yesterday.
EQUITIES LOWER EXCEPT TOKYO
In New York, Wall Street ended down -0.2% on the S&P500 in its Thursday trade. Tokyo has opened up +0.8% in its Friday trade. Hong Kong is down -0.4% today in early trade. Shanghai has opened down -0.5% today. The ASX200 is down -0.2% in afternoon trade and that is matched by the NZX50 in late trade today.
GOLD DOWN
In early Asian trade, gold is down at US$2010/oz and down -US$22 from where we were this time yesterday. That is below the earlier New York close of US$2015/oz and below the earlier London close of US$2016/oz.
NZD FALLS BACK
The Kiwi dollar is down almost -1c from this time yesterday at 62.8 USc. Against the Aussie we are nearly -½c softer at 93.7 AUc. And against the euro we are down -½c at 57.5 euro cents. That means the TWI-5 is now down to 70.7 and back where it was a week ago.
BITCOIN DROPS
The bitcoin price is down sharply today, now at US$26,615 US$27,548 and down 3.4%. Volatility over the past 24 hours has been moderate at +/- 2.0%.
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 ».
46 Comments
These are peer-to-peer loans where investors fund borrowers needs via their platform. It is not Squirrel borrowing the money.
They're essentially a peer to peer lender, doing personal loans and mortgages to people that can't get mortgages at the regular banks. Higher return and higher risk compared to a bank term deposit, particularly given the falls in house prices over the last 18 months.
Basic 1920s brick home on Sydney waterfront sells for $53 million in Australia | Stuff.co.nz
https://i.stuff.co.nz/life-style/homed/300877502/basic-1920s-brick-home…
Give me a sledge hammer and I will start improving the sites value.....
Location location location.... turangi
if you had grabbed a riverside (Judges pool) place at the end of hydro, you may just have bettered that CAGR.
Its been a great ride HW2 but you have to know when to fold em, know when to walk away and know when to run
Every gambler knows that the secret to survivin'
Is knowing what to throw away and knowing what to keep
'Cause every hand's a winner, and every hands a looser
What did you throw away HW2, I threw away right at the top... or are you a greedy pig and holding all the way to the bottom, I passed my winning hand to the next loser. Was it you?
It must really piss you off that such a bad speller is such a good property trader.
And how you cannot claim any ability to trade property for profit as you have never said.... sell.
I do not trigger untill I pull the trigger at the bottom. we are not there yet , I will tell you when so you can buy as well.
🤣🤣 fark thats funny HW2. " share the same views / same spelling mistakes"
Jeepers creepers bro, nobody makes as many mistakes as me... thats why i know so much👌... plus i use a ''google free" add blocker system in privacy mode, which means no spell check... so i'm old school bro
Mate, you nèed to stop looking over your shoulder and just be you and be proud of it.
Crikey dick mate if we were all the same we would be freaken boring!
https://www.oneroof.co.nz/news/43579
5m from 500k in '97
9.1 pct CAGR they made 4.5m over 26 years. Whereas I made more than that, 4.9m over 6 years. SH-IT GUY eat your heart out.
Whereas I made more than that, 4.9m over 6 years.
What suburb what period what CAGR purchase and sale price > seems strange a guy of your conviction on this forum is not sitting on a loss, you have been telling everyone to buy... have you not perhaps followed your own advice?
I just read Consumer's release about their survey:
“While we appreciate banks are not charities and should make a reasonable profit, the question is what level of profit is reasonable and at what point does profit become excessive,” said Duffy.
This idea of "reasonable profit" or "excessive profit" is incredibly stupid. Bank profits are measured in the same inflating currency as all goods and services. If you were to measure the bank profits in gold, you'd likely find profits were flat to declining over time.
banks are getting way higher ROI then s debt.... becaues its leveraged lending.......
Wish I could do a whiteboard session. As the skin in the game gets thinner the profit gets larger.
If you want lower bank profits just make them put more skin in the game (social license maybe), by the way it would be safer as well...because the non skin bit tends to be foriegn money that gets all nervous at a time of crisis, and runs away.
This is not really rocket science, how many bankers do you know that would even get past CV review at Rocketlab?
This is not really rocket science, how many bankers do you know that would even get past CV review at Rocketlab?
Most of the market makers, at the bank I worked for in London for seventeen years, had a first in maths from Cambridge or Oxford. I was given a pass because I had an Hons degree from NZ.
How would this reduce the settlement account balances in aggregate? Genuine question - just can't picture the balance sheet movements..
LOL - exactly, someone has hold these balances until the corresponding bonds are sold or redeemed. It is possible for one bank to sell them to another ESAS bank.
Furthermore, the drop in the Crown Settlement Account balance is a result of a bond maturity on 15 April 2023 extinguishing the associated deposits created by banks on the prior syndicate and tender dates.
A chart that is updated quarterly, tracking NZ real house prices can be found here for those interested:
The series is deflated using CPI (not incomes or any other measure) so take that with whatever relevance (or irrelevance) you wish (good or bad).
In real terms, prices peaked in 1975 and it took 20 years to reach that high once again.
As you can see, since the 1980's its been strong growth in real terms, which happens to coincide with global interest rates falling from a very elevated level, to record low levels. It would indicate an optimum time to buy a house would have been in the early 1980's as interest rates were peaking (if you were lucky enough to be in the right time at the right place).
After about 2000, anyone who didn't get on the housing market skyrocket has been significantly disadvantaged, relative to the general rate of inflation across the economy.
Note that house prices shouldn't climb this quickly relative to the general rate of inflation - it shows the market is likely on an unsustainable trajectory (not supported by general income inflation) - its reliant on falling interest rates and low inflation.
If you view the US 10 year treasury yield against this chart (to show a trend for global inflation and interest rates - and can be added to this chart) you can see the mirror (inverse correlation) between property prices and interest rates.
A chartist with a particularly sharp pencil might suggest "That's some Head-and-Shoulders" pattern that's showing. If so, we are headed off to the shoulder - 2019 prices first up, followed down to 2016, then a quick slip back to 2011. Perhaps then rally to 2007, then back to 2001.
Interesting times ahead.
You can see in this chart that after the GFC, real US house prices fell back to their 100 year trend.
If we were to do the same, and fall back to a 1990's real house price then that would be a spectacular drop:
1. either in nominal terms
2. or because of very high inflation for a longer than expected period
3. or a combination of both.
Not saying this is an outcome...but house prices didn't provide much return in real terms for about 100 years before the 1990's (at which point they started getting detached from incomes/general rate of inflation) so it is a possibility.
Lol - so positive news then on an existential front in comparison to the economic?
https://th.bing.com/th/id/R.fdfe15f94bd554a0c7499c1e8677d846?rik=bQE2K0…
Foreign tourist arrivals rebounded to 69% of pre-pandemic (2019) levels in February, arresting the drop-off in the recovery over the past two months.
translation,:
foreign tourist down 31% from pre lockdown mania! Revealing Stuart Nash's post COVID recovery plan was another another croc of crap!
Stuart said - "We will roll out a $200 million Tourism Communities: Support, Recovery and Re-set Plan between now and 2023"
Read all the labour nashy lies here...
https://www.beehive.govt.nz/release/support-recovery-and-re-set-plan-to…
Where's that Ass hat now?...
no accountability for these W Anchor's
$159m for developers:
https://www.newstalkzb.co.nz/on-air/heather-du-plessis-allan-drive/audi…
Go the Warriors.... We Shafted the dogs
in other news
11 May 2023
Ready-mixed concrete statistics provide an indicator of construction activity.
Key facts
- In the March 2023 quarter, the actual volume of ready-mixed concrete produced was 983,106 cubic metres, down 13 percent compared with the March 2022 quarter.
- In the year ended March 2023, 4.52 million cubic metres of ready-mixed concrete was produced, down 1.3 percent compared with the year ended March 2022.
- In seasonally adjusted terms, the volume of ready-mixed concrete fell 5.3 percent in the March 2023 quarter, following a 2.5 percent fall in the December 2022 quarter.
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.