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
Unity Money raised its 18 and 24 month fixed home loan rates.
TERM DEPOSIT/SAVINGS RATE CHANGES
Unity Money raised its 6 month and 1 year TD rates today, both 6% or higher. The Cooperative Bank also raised TD rates.
THE UNEMPLOYMENT RATE IS RISING
Stats NZ said today that those without jobs rose to 116,300 (+10,000 from June and +22,300 from a year ago) and that is an actual jobless rate of 3.84% (seasonally adjusted was 3.89%). While the number of jobless rose, the number of people employed fell almost -2000 from June although this is up a strong +68,500 in a year. There are now 2,912,000 employed people in the workforce, fractionally lower than the record high in June, and 369,500 are self-employed (and without employees). The number of part time workers was little-changed (all of the increase in unemployment was from full-time positions). Of the 586,000 part-time workers, only 59,200 were actually seeking more work.
PAY INCREASES FOR SOME EASE BACK
Private sector wages rose +4.1% in the year to September from a year ago, down from a +4.5% rate in June. In contrast public sector wages rose at a +5.4% pa rate following generous increases (+7.2%) for the health sector. The education sector wages rose +5.0% in the year, those for the rest of the public sector up +5.4%. Taxes on private sector wages essentially pay public sector payrolls.
ON THE LOOKOUT FOR LENDING STRESS
In its semi-annual Financial Stability Report released today, the RBNZ says if economic conditions deteriorate by more than projected the lending stress could be more severe. They report that the big banks say non-performing loans could double over the next year.
MORE THAN 10,000 NEW CARS SOLD IN SEPTEMBER
Car sales were surprisingly strong in October. 10,055 new passenger cars were sold in the month, plus 9,657 used imports. Both were sharp increases from August, but the new car sales were -6.6% less than the hot September a year ago. The average for the prior ten years for a September is 9,400 in the month. Used imports were up +33% from the same month a year ago. Lagging a lot are sales of new commercial vehicles, down -31% from a year ago now.
SELLDOWN FROM BRAZIL COMPLETE
Fonterra said today that the sale of Fonterra and Nestlé’s DPA Brazil joint venture to French dairy giant Lactalis is complete.
$1 MLN MORTGAGE BROKER SCAM
The FMA charged Natalie Ann Carter, a former Hawke’s Bay-based mortgage broker, with multiple dishonesty offences following an investigation into her conduct. She pleaded guilty to eight of the 15 charges filed against her in the Napier District Court today. The FMA alleged that between 2018 and 2020, Ms Carter created various false documents for the purpose of obtaining home loans for herself and two clients. The documents were fake pay slips, contracts and employment verification forms from fictitious employers. In total, seven home loans were applied for, totalling $2.91 mln in value. At least three of the seven home loan applications were successful to the total value of $1,087,700.
MITIGATIONS START
Auckland Council is starting to address the buyout / remediation issues for the 2023 Extreme Weather Events. It's complicated, so reading this will be helpful. They are starting slow, so frustration levels won't ease quickly. But some progress is starting.
SURPRISE DISAPPOINTMENT
In Australia, building consents dropped -21% in September from a year ago. They fell -4.6% from August. These were sharper retreats than expected because a rise was expected from August.
CHINA LOWER
Mirroring the official version, the private Caixin PMI for China's factory sector slipped lower into contraction in October. It just reinforces earlier data that they are in a funk, one that will be hard to escape from - at least in the way they were running pre-pandemic. This Caixin report drop wasn't expected.
SWAPS TURN DOWN MARGINALLY
Wholesale swap rates have probably settled back today but not by a lot. The real reaction will come at the close. Our chart will record the final positions. The 90 day bank bill rate is unchanged at 5.64% and now +14 bps above the OCR. The Australian 10 year bond yield is unchanged from yesterday at 4.97%. The China 10 year bond rate is down another -1 bp at 2.71%. The NZ Government 10 year bond rate is down -4 bps at 5.58% from yesterday, but still above the earlier RBNZ fixing of 5.53% which was up +7 bps from yesterday. The UST 10 year yield is up +4 bps from this time yesterday to 4.93%. The UST 2yr is up +4 bps to 5.09%, so the curve inversion has narrowed further but only slightly, now only -16 bps.
EQUITIES MOSTLY HIGHER
The NZX50 is up +0.3% in late trade today. The ASX200 is up +0.4% in early afternoon trade. Tokyo has opened up a very strong +2.2%. Hong Kong is starting its Wednesday down -0.6%, and Shanghai is unchanged at its open. Singapore is up +0.3% at their open. The S&P500 ended its Tuesday Wall Street session up +0.7% but down -2.2% for the full month.
GOLD LOWER
In early Asian trade, gold is now at US$1980/oz and down -US$16 from where were this time yesterday. Earlier it closed in New York at US$1986/oz. And earlier still at US$1996/oz in London.
NZD LOWER AGAIN
The Kiwi dollar has fallen -¼c to 58 USc from this time yesterday. But against the Aussie we are little-changed at 91.6 AUc. Against the euro we very marginally softer at 54.8 euro cents. That means the TWI-5 is down -20 bps at 68.2.
BITCOIN LITTLE-CHANGED
The bitcoin price is little-changed today, now at US$34,566 and up just +0.3% from this time yesterday. Volatility over the past 24 hours has been low at just under +/- 1.0%.
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