A review of things you need to know before you sign off on Thursday; no retail rates changes, settlement balance winner; more GIF lending, Aussie part-time jobs surge, swaps on hold, NZD rises, & 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
No changes to report today.

TERM DEPOSIT/SAVINGS RATE CHANGES
None here either.

SETTLEMENT BALANCES SETTLE
The Crown's settlement balances at the RBNZ (R3) rose +$3.8 bln in August from July to be $24.9 bln which was -$7.3 bln lower than the same month a year ago. Financial institution settlement balances fell -$2.7 bln to $49.2 bln which was +$4.7 bln more than a year ago. Settlement balances pay the OCR rate, so the Crown earned $114 mln in interest in August (tax-free, you would assume). Meanwhile banks earned $226 mln in interest and would pay tax of $63 mln on that. In the end, the Crown did better out of their $24.9 bln balances than the banks who had a $49.2 bln combined balance. (Crown = $177 mln in interest and tax on the banks holdings; Banks = $163 mln after tax.)

IT'S EASY RAISING MORE EXPENSIVE FUNDING
There was yet another NZGB bond tender today and it was very successful. There were three maturities totaling $500 mln offered and they attracted 118 bids worth $1.326 bln. The May 2026 tranche went for a 5.20% yield which was up from 5.06% four weeks ago. The May 2031 tranche went for a yield of 4.95%, up from 4.89% two weeks ago. And the May 2041 $100 mln went for a yield of 5.17%, up from 5.08% two weeks ago.

MORE POLICY RELEASED
There was a National Party water policy released today and uploaded to our policy comparison tool.

ANOTHER NZGIF LOAN
Lightyears Solar has recently completed the construction of their first solar farm in Waiuku, South Auckland, with a 3700 panel 2.4 MW farm that is the largest agrivoltaic and tracked solar farm in New Zealand. It goes live this month. It has now received a $15 mln long term loan from the NZ Green Investment Fund to build out the next projects in its schedule, a 7 MW solar farm in Ashburton and a 4.5 MW solar farm in Wairarapa. The NZGIF is a state-owned investment bank with $437 mln in assets and a plan to make $8.7 mln in profit this year.

PART-TIME NATION
In Australia, there was a bigger than expected surge in employment in August but most of it was for part-time jobs. Full time jobs grew by a tiny +2,800 while part-time jobs grew by +62,100. Their jobless rate stayed at 3.7% in August as expected but that remains a 3 month high matching July's rate. There are now 540,500 people without jobs, up +42,600 from a year ago. (For comparison, Australia has 69.5% of their employed workforce in full time jobs, its lowest level in 10 months; New Zealand has 80.0%, a level we have been at for five years and the best since the 1990s.)

ORDERS FALL, BUT ...
In Japan they recorded a drop in new machinery orders in July. This series does not include orders for ships or electric power systems. Including them, orders rose sharply. The decline in core orders was driven mainly by a -5.3% decrease in the manufacturing sector, while the non-manufacturing sector posted a +1.3% increase. Industries in the manufacturing sector with the sharpest falls include for petroleum & coal products where orders fell a startling -57%.

SWAPS ON HOLD AGAIN
Wholesale swap rates were probably little-changed again today across the whole curve, with perhaps small rises at the short end. But the real reaction will come at the close. Our chart will record the final positions. The 90 day bank bill rate is down -1 bp at 5.66%. The Australian 10 year bond yield is down -4 bps to 4.12%. The China 10 year bond rate is unchanged at 2.66%. The NZ Government 10 year bond rate is little-changed 5.03%, but still above the earlier RBNZ fixing of 4.98% which was also down -1 bp today. The UST 10 year yield is down -6 bps at 4.23%.

EQUITIES MEANDER
The NZX50 is down -0.5% near today's close. But the ASX200 is up +0.3% in early afternoon trade. Hong Kong and Shanghai are both little-changed at their open today. Tokyo has opened its Thursday trade up +0.9% which has covered all the week's prior losses. And the S&P500 up +0.1% in Wednesday trade on Wall Street.

GOLD HOLDS
In early Asian trade, gold is at US$1910/oz and up +US$1 from this time yesterday. Earlier in New York it closed at US$1908/oz also, and earlier still in London at US$1914/oz.

NZD UP
The Kiwi dollar has risen almost +½c to 59.3 USc. Against the Aussie we are back up at 92.2 AUc and staying it its recent tight range. Against the euro we are also up +½c at 55.3 euro cents. The TWI-5 is up +50 bps to just over 68.7.

BITCOIN FIRMER
The bitcoin price is a little and now at US$26,187 and up another +1.0% from this time yesterday. Volatility over the past 24 hours has been modest at just over +/- 1.3%.

This soil moisture chart is animated here.

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