A review of things you need to know before you sign off on Thursday; no retail rate changes, Crown accounts reveal rising tax take, weak inbound tourism, high demand for NZGBs, swaps ease, 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). It's a skinny edition today.

MORTGAGE/LOAN RATE CHANGES
None so far again today.

TERM DEPOSIT/SAVINGS RATE CHANGES
None here either.

COMCOM REVEALS DATE FOR DRAFT BANKING MARKET STUDY REPORT
The Commerce Commission says it'll publish the draft report in its market study into personal banking services on March 21. It says this'll include its preliminary findings and outline any options for recommendations to improve competition that it's considering. A public consultation process will follow, including submissions and a consultation conference hosted in Auckland and online. It's required to publish its final report by August 20 this year, which may include recommendations identifying ways to improve competition in the sector for the benefit of New Zealand consumers.

PASSED THE PEAK?
A net +7,260 migrants arrived in excess of those who left in December, up slightly on the November pace of +6,820. (This data uses the StatsNZ 16/12 method.) But the December level was less than the same month in 2022, so this may be tentative evidence that net inflows have passed their peak.

MORE IS NEVER ENOUGH
The half-year Crown accounts show an improving tax-take. For the second consecutive month, the Government collected more than $5 bln in income tax payments from individuals, and the rate of growth ticked up to +7.1% over the same month a year ago. That rate had been falling relentlessly each month for the last two years. GST collections also ticked back up in December, to $2.58 bln in the month (up more than +30% from the same month a year earlier), also the first time consecutive months have breached $2.5 bln. It is also interesting to note that withholding tax collected on interest income double in December from a year earlier to $337 mln in the month. But is this enough? Finance Minister Nicola Willis says higher interest rates and rising unemployment could mean the Government has less money to work with in the next budget.

FALTERING?
December was a slightly disappointing month for tourist arrivals. There were 418,869 foreign tourist arrivals in the month, but at that level we are further away from getting back to pre-pandemic levels. We are down to 79% of that benchmark in December having been at 82% in November.

SBS BANK $60 MLN PRICED
The SBS Bank tier 2 capital raising of $60 mln has been priced at 7.62% pa. Obviously they won't use these funds to support mortgage lending. But it could flow to the FinanceNOW operation where interest rates earned are much higher, between 12.5% and 29.95%.

NEW CFO
Tauranga-based First Mortgage Trust said it has appointed Andrew Western as Chief Financial Officer. He was previously "General Manager - Group Financial Controller", at ASB. It appears he will be based in Auckland. First Mortgage Trust is a $1.65 bln fund in registered schemes based on real estate, with about 6,500 investors.

RETAIL GROWTH - FROM A LARGER POPULATION
ANZ's internal analysis of its electronic card transactions shows annual growth in most categories of spending is back in the black. Annual growth in total spend lifted from 2.5% to 3.5%. Recent momentum as measured by the change in the 3-month average was also stronger. Population growth is likely a big driver. Spending on durables and clothing remains weak, but the annual fall softened from -5.3% in December to -3.0%. Tourism-related spending remains a bright spot.

UPDATE
Regular readers should note that we have updated our Median multiples page through to January 2024. We do this work because journalists at other sites like to use the metric and it is best if a comprehensive and accurate record is available. But we are not fans of this metric as a measure of housing affordability. And that is because it ignores movements in interest rates. And it ignores changes in income tax rates. It also uses overall measures of household income, not targeted at the house-buying cohort. We much prefer the home loan affordability measure because it includes both those among many other elements and is a much better test of serviceability stress.

HEAVY SUPPORT
There was a heavily supported NZ Government Bond tender today. $500 mln was offered in three maturities. Almost $1.8 bln was bid in 92 separate bids, but only 24 bids were accepted. Yields rose for each issue. The April 2027 yield is now 4.80% and up from 4.52% three weeks ago. The April 2033 yield is now 4.81% and up from 4.75% one week ago. The May 2051 issue is now over 5%, at 5.08% and up from 4.81% two weeks ago.

RECIDIVIST
A Dunedin company director has been jailed after being convicted for a second time for failure to pay PAYE. Leslie John McKenzie plead guilty to 48 charges of aiding and abetting his three companies to deduct tax from workers’ wages, which were never passed on to Inland Revenue.

PULSING UP
Yesterday there was another GDT Pulse auction for WMP and SMP. It is worth noting that WMP prices rose +19% from the prior Pulse event, and SMP was up +4.5% on the same basis. There is another full GDT auction Wednesday next week, but current indications are for steady trend increases in price.

10,000 MORE
Telco network Chorus has launched a fibre build-out to cover another 10,000 premises

SEASONAL DROP
Bank settlement balances at the RBNZ fell -$5.4 bln in January from December, now at $44.9 bln, the lowest level in 19 months. These balances tend to fall in these months. They maxxed out in December 2022 at $56.5 bln.

JOBLESS JUMP
For the first time in two years, the Australian jobless rate has risen above 4%. The actual 4.5% rate means they now have 654,000 people without jobs, the highest level since October 2021. (The headline rate is the 4.1% seasonally adjusted rate.)

NZ NOT THE PRIMARY DESTINATION NOW
For the first time since their statistics agency started collecting travel records (nearly 50 years ago), in 2023 Indonesia replaced New Zealand as the top destination for short-term trips overseas by Australians. Almost 1.4 million Australians travelled to Indonesia in 2023, while almost 1.3 million travelled to New Zealand. More than 10 mln trips overseas were taken by Australian, but the only attracted 7 mln international visitor visits.

SWAP RATES EASE
Wholesale swap rates will probably be lower today on a global correction. However, the key reaction will come at the close. Our chart below records the final positions. The 90 day bank bill rate is up +1 bp to 5.74%. The Australian 10 year bond yield is down -14 bps at 4.16%. The China 10 year bond rate is unchanged at 2.45% while they are on holiday. And the NZ Government 10 year bond rate is down -12 bps to 4.89%, while the earlier RBNZ fixing was at 4.92% and down -2 bps from yesterday. The UST 10 year yield is now at 4.23% and down -9 bps from yesterday. The UST 2yr is now down to 4.57% and so that key inversion is now still at -34 bps.

EQUITY WINNERS & LOSERS
The NZX50 is down -0.4% in late trade today. But the ASX200 is up +0.6% in afternoon trade. Tokyo has opened up +0.7%. Hong Kong is down -0.1% iat their open. Shanghai is still on holiday. Singapore has opened up +0.5%. Wall Street ended its Wednesday session up +1.0%, back at 5000 level.

OIL PRICES DIP
Oil prices are down -US$1 at just on US$76/bbl in the US while the international Brent price is now just under US$81/bbl. Excessive crude oil inventories in the US is behind this weakness.

GOLD HOLDS LOWER
In early Asian trade, gold is now at US$1993/oz and up +US$3 from this time yesterday.

NZD FIRMS
The Kiwi dollar has risen slightly from where we were this time yesterday, now at 60.8 USc and up +20 bps. Against the Aussie we have held at 93.9 AUc, a jump back to this earlier level after a trend lower, and following the Aussie labour market surprise. Against the euro we are marginally higher at 56.7 euro cents. That means the TWI-5 is now at just over 70.3 today and up +20 bps.

BITCOIN UP
The bitcoin price has moved up sharply today, now at US$52,225 and up +5.6% from this time yesterday. There's been high volatility over the past 24 hours of just on +/- 3.3%.

This soil moisture chart is animated here.

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