A review of things you need to know before you sign off on Thursday; building consents struggle, confidence honeymoon extends, NZGBs popular, TDs very popular, swaps stable, NZD reverts, & 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 today here either.

SHARP DROP
Residential building consents were down -21% in October from a year ago. But even though they were up +8.7% from September, analysts say they are losing momentum. Meanwhile, construction costs have 'all but stabilised', Stats NZ reported.

MOVING UP
Economists at the country's largest bank have raised their forecast milk price for the current season by 55 cents to $7.70 per kilogram of milk solids; pick $8.50 price for next season.

ALMOST A 9 YEAR HIGH
Indications of likely future inflation continue to drift lower in the latest ANZ Business Outlook Survey, but the new Government's honeymoon continues, with business confidence hitting its highest level since early 2015

HIGH DEMAND, LOWER YIELDS
Today's NZ Government bond tenders were again heavily supported. There were 139 bids across the three maturities putting more than $1.5 bln on the table for the $500 mln available. Yields fell. The May 2030 $200 mln saw them fall to 4.78% from 4.92% two weeks ago. The May 2032 $250 mln saw them fall to 4.83% from 4.97% just one week ago. And the $50 mln May 2051 saw them fall to 5.04% from 5.16% just one week ago.

BANK DEBT EXPANSION TEPID
October lending growth was modest and positive across the board in October. (C5) Housing lending was up +3.0% from a year ago, a similar gain to what we have seen for seven months now. Business and rural lending growth has been stable too at +1.6% and 1.0% from a year ago, similar to what we have had for the past three months, but both much lower than earlier. If we are in a recovery, it is not being led by bank debt. More here.

TDs ARE OUR NEW FAVOURITE INVESTMENT
Household bank balances (S40) rose more than +$1.6 bln in October from September to a record $238.5 bln, the second fastest monthly gain in more than a year. Household transaction and savings account balances were broadly stable, but we poured an additional +$1.7 bln into term deposits and we now have $123.2 bln invested there (a new record high), up +$23.5 bln from a year ago. What is different now is that all our new cash holdings are going into TDs. The period where we switched out of transaction and savings accounts seems to be over.

A BIT MORE IN THE TANK
The October data (D10) shows little change in overall Settlement Balances at the RBNZ, but they did rise by +$1 bln to $53.1 bln primarily because of liquidity management activity with FX swaps.

'CONFIDENCE' DESPITE 'ISSUES'
The real estate industry licensing authority reckons confidence in the industry is high and holding. Their 2023 survey found 84% of consumers reported overall confidence in the industry (85% in 2022; 86% in 2021). But more than one in five said they experienced an issue with a real estate transaction in the previous 12 months, with almost half of those issues being agent-related – down from 75% in the 2022 survey. Of those agent-related issues, consumers reported that the most significant related to information transparency and quality. All this relates to what the REA research says. However, given there were 57.800 residential real estate transactions in the survey period, that means 12,100 transactions had "an issue". And 5,800 related to the real estate agents involved. And given there are 15,800 licensed real estate agents, on average one in three of them are involved in "issues", according to the research. It is hard to reconcile that data with the REA's overall conclusion.

SURPRISE JUMP
In Australia there is some substantial positive action in residential building consents. They rose an impressive +7.5% in October from September to be -6.1% lower than a year ago. That is a huge improvement from the year-on-year fall of over -20% in September. It is a sharp shift up that wasn't anticipated by analysts. Still, despite the rise the overall levels remain low.

DOWN & UP
In Japan, the steam seems to have gone out of their rising retail trade. It fell in October from September by -1.6% to be +4.2% higher than a year ago. Meanwhile, Japanese industrial production has turned up in October, its biggest monthly rise in almost a year.

MORE MINOR SLIPPAGE
China's official November PMIs brought some more minor slippage. The factory sectors contracted slightly faster (although it is still minor); it was expected to contract less. And their services sector's expansion, already minor, eased toward a steady state. It is hard to see how Beijing will be happy about these trends. Their top-level charm offensive of recent weeks isn't working yet in terms of getting business people to change their actions and reactions.

SWAPS HOLD
Wholesale swap rates have probably held today. (Update: No they didn't; they fell.) However, the key reaction will come at the close. Our chart will record the final positions. The 90 day bank bill rate is unchanged at 5.62% and now just +12 bps above the OCR. The Australian 10 year bond yield is down another -2 bps from this time yesterday to 4.35%. The China 10 year bond rate is little-changed at 2.70%. And the NZ Government 10 year bond rate is down -6 bps at 4.98%, while the earlier RBNZ fixing was at 4.93% which was down -4 bps today. The UST 10 year yield is now at 4.25% and down -3 bps from yesterday. The UST 2yr is now at 4.65% so that key curve inversion is less at -40 bps.

EQUITIES MIXED
The NZX50 is up another +0.3% in late trade today. The ASX200 is down -0.2% in afternoon trade. Tokyo has opened unchanged again. Hong Kong is little-changed at their open. Shanghai is up a minor +0.1%. Singapore has opened down -0.3%. Earlier today on Wall Street, the S&P500 closed down a minor -0.1%.

GOLD DIPS
In early Asian trade, gold is now at US$2045/oz and down -US$2 from yesterday. Earlier it closed at US$2043/oz in New York and earlier still also at US$2047/oz in London.

NZD REVERTS
The Kiwi dollar is -¼c lower than this time yesterday at just under 61.7 USc. Against the Aussie we have fallen back -¾c to 92.4 AUc. Against the euro we are also back down to 55.5 euro cents. That means the TWI-5 is at 69.7 and where we were before yesterday's MPS.

BITCOIN STILL MEANDERING
The bitcoin price has moved back down today, now at US$37,767 and -0.7% lower than this time yesterday. Volatility over the past 24 hours has been modest at just on +/- 1.0%.

STAY UPBEAT
Today is the last day of spring. Summer starts tomorrow.

This soil moisture chart is animated here.

Keep abreast of upcoming events by following our Economic Calendar here ».