A review of things you need to know before you sign off on Wednesday; sharp dairy prices falls, RBNZ leaves OCR unchanged, real estate sector heads 'south', swaps unchanged, NZD firms, & 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/LOAN RATE CHANGES
Nothing today.

TERM DEPOSIT/SAVINGS RATE CHANGES
None to report so far here either.

REDUCING & RETRENCHING
Dairy prices fell a sharp -7.4% at today's auction to take them -25% lower than a year ago. Volumes on offer at this event were their highest since December 2020. The WMP price fell almost -11% in USD terms and -8.5% in NZD terms. The sharply falling trend has induced some analysts to cut their milk payout forecasts sharply, and to levels probably below most dairy farmer's break-even levels. Mitigating the pain for Fonterra farmers will be the imminent large capital return, and the prospect that Fonterra's dividend will be higher than usual this year. Still, lower milk prices will hurt, and that hurt will extend deep into the economy.

NO CHANGE, BUT NO PROSPECT OF A CUT
The RBNZ held its OCR level at 5.50% at its latest Monetary Policy review. But they said interest rates will need to remain at a restrictive level for some time.

TRADE ME CONFIRMS HOUSING PAIN
It was a tough month on Trade Me Property in July with new listings, site views and average asking prices all heading south.

FHBs STILL ACTIVE
First home buyers push their borrowing limits up a little. The latest quarterly Reserve Bank figures show that the country's new first home buyer borrowers have just started to stretch themselves a further again.

DASSET IN LIQUIDATION
Grant Thornton's David Ruscoe and Russell Moore have been appointed liquidators of Digital Asset Exchange Ltd (Dasset), a NZ digital assets trading platform. Dasset’s management says a significant reduction in asset values and trading levels impacted its ability to trade profitably. Thus the appointment of liquidators was viewed as being in the best interests of all stakeholders, and came via a special resolution of shareholders. Liquidators’ initial focus is on securing and protecting Dasset’s assets. "We understand users and creditors will be disappointed by the news that Dasset has gone into liquidation. The process of securing the assets is complex; there are third parties involved and nearly 100 different types of digital assets. We will work with management and third parties to resolve any issues as soon as possible, and we will update all stakeholders on progress as regularly as possible," Moore said. Grant Thornton will contact customers and suppliers over the next few days, with an initial report to follow next week. 

NOW 5¼ MILN
The resident population rose to 5,223,100 as at June, up +2.1% from a year ago. This is the strongest annual growth in about five years. Growth in the working-age population (15-64) was +2.3%, boosted by reopened borders.

SPIKE IN DEATHS
There were 57,534 live births were registered in the year to June 2023, down from 60,009 in the prior equivalent year. There were 38,346 deaths were registered, up from 36,723 as Covid took its extra unusual toll. That means our 'natural increase in population (excluding migration) was +19,185, down from +23,280. Our infant mortality rate however fell to 3.49 deaths per 1,000 live births, down from 3.85 in the June 2022 year.

'OPEN SLATHER' AN ELECTION WINNER?
National is hinting the foreign home house buyer ban will be lifted. The pre-TPPA ban on foreign homebuyers could be changed under a National-led government, and Labour notes that any such change would then be irreversible because of the Treaty obligations.

ANZ NZ CHIEF RISK OFFICER DEPARTING
ANZ NZ says Grant Knuckey, its Chief Risk Officer, will leave the bank next March following four years in the role. Knuckey says he will be looking at different opportunities where he "can get back to running and growing a business, including potential options here at ANZ." The bank says an announcement on his replacement will be made in due course.

BNZ EYES BOND ISSUE
BNZ says it's considering making an offer of five year unsecured, unsubordinated fixed rate notes to NZ retail investors and to certain institutional investors. The bank says full details of the offer will likely be released in the near future, subject to market conditions.

HOUSE PRICES FALLING
China's new home prices fell in July from a year ago, and from a month ago they were unchanged. But in their largest 70 cities, prices for second hand homes are falling in 65 of them from the same month a year ago. The pressure is on their residential housing market in a way that makes property development a losing proposition there.

SWAPS UNCHANGED
Wholesale swap rates were little-changed before the RBNZ MPS but the real reaction will come after the press conference until the close. Our chart will record the final positions. The 90 day bank bill rate is little-changed yet again at 5.65% and now +15 bps above the 5.50% OCR. The Australian 10 year bond yield is down -4 bps from this time yesterday at 4.22%. The China 10 year bond rate is unchanged at 2.59% and a three year low. And the NZ Government 10 year bond rate is little-changed at 5.00% and its highest since 2011, and still higher than the earlier RBNZ fix which was up +6 bps bps at 4.94%. The UST 10 year yield is at 4.20% and unchanged from yesterday and its highest since October 2022. Rising long rates are a global trend (except in China).

EQUITIES SHARPLY LOWER EVERYWHERE
The NZX50 is down -0.9% today in late trade. The ASX200 is down -1.4% on the realisation earlier bets on new Chinese stimulus aren't going to be significant. Tokyo has opened its Wednesday session down -1.1% in morning trade. Hong Kong has opened down another sharp -1.4% and Shanghai is down another -0.7%. The S&P500 ended its Tuesday session down -1.2% with a late sag.

GOLD SOFTER
In early Asian trade, gold is at US$1903/oz and down a further -US$3 from yesterday. Earlier in New York it closed at US$1901, and earlier still in London it closed at US$1902/oz.

NZD FIRMS AFTER MPS
The Kiwi dollar is holding, down -20 bps from this time yesterday at just over 59.6 USc although it was down-40 bps before the MPS. Against the Aussie we are +½c up at 92.6 AUc. Against the euro we holding at 54.7 euro cents. That means the TWI-5 is at 68.8 and little-changed.

BITCOIN STILL NOT GOING ANYWHERE
The bitcoin price is virtually unchanged - again -since tis time yesterday, now at US$29,214 and down a minor -US$137 or -0.5%. Volatility has stayed low at just on +/- 0.6%.

This soil moisture chart is animated here.

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