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
The Co-operative Bank reduced its one year fixed rate.
TERM DEPOSIT/SAVINGS RATE CHANGES
None here today.
LOOKING FOR MORE ACTIVE COMPETITION
The RBNZ says retail bank competition should be ‘extreme’. Governor Adrian Orr makes pointed comments saying competition between retail banks should be heating up as the Commerce Commission prepare to report back on its market study
FHB PRICE RELIEF OFFSETS INTEREST RATE HIKES
Falling lower quartile house prices means that the average amount first home buyers are paying for a home dropped by almost -$17,000 last month
HARD HITS
Partially listed T&G Global (actually a subsidiary of the giant German co-operative-controlled BayWa of Munich) posted higher revenues, but a big loss after the Hawkes Bay cyclone damage. They weren't the only one; Seeka did too.
CREATIVE (?) WRITING
We are about to get end-of-month real estate updated for February. And that probably means a flood of releases pointing out that "buyers have more choices" (ie, listings are growing much faster than sales). We await these reports and the creative language they use.
REALLY DRAGGING NOW
There was a very large dump of a wide range of RBNZ EOM data today at 3pm, and more than we can digest in 60 mins. And it doesn't help that some of it was released quite late. So will will cover off some of the more interesting bits tomorrow. In the meantime we can note that the rise in housing debt in January from December was unusually low at +$590 mln (?? just 120 extra $500,000 loans ?? for the whole country ??). The average January rise over the past ten years was +$1.4 bln, giving an indication of just how slow the real estate market has been to start 2024. In fact this year's rise is the least since January 2012.
WATCH & WORRY; UP +10% IN ONE MONTH
Those latest RBNZ figures show non-performing housing loans rose by +$161 mln in January and have increased by $721 mln over the past 12 months. The non-performing housing loan ratio has now hit a 10-year-high.
NAMED & WARNED
Twelve New Zealand retirement villages are in the Commerce Commission’s firing line following an investigation by the consumer watchdog into the retirement village sector’s practices that started last year. Some of the providers were found to have risked “misleading consumers” while others had contract terms that the commission said could cause “financial detriment” to residents in villages. NZX-listed Arvida Group, Ryman Healthcare and Oceania Healthcare were on the list of retirement village operators that got letters from the Commission, along with Heritage Lifecare Villages, Tamahere Country Club, Ultimate Care Group, Metlifecare, The Vines at Bethlehem, Althorp Village, Coastal View, Omokoroa Country Estate and The Grove Orewa.
MORE WORK TO BE DONE
The February ANZ business confidence survey 'doesn’t suggest the economy is rolling over or that inflation has been beaten', they say. ANZ economists continue to think there’s a high chance that forthcoming data will show more work needs to be done by the Reserve Bank to return inflation to its target in an acceptable time frame. February confidence has slipped from the nine year peak in January.
KEEP IT CLEAN
When housing is developed near a working port, the needs of the recently-arrived will always trump port activities. The Port of Tauranga and its related industrial zone now has new Environment Court-encouraged rules proposed for the spillover impacts of its cargo handling in the Mount Maunganui area.
STRONG DEMAND AGAIN
There was no shortage of demand for the New Zealand Government bonds issued today. Almost $1.2 bln was bid in 79 bids for the $500 mln on offer. Perhaps surprisingly the May 2028 $300 bln tranche brought higher yields for investors, up to 4.55% pa from 4.41% for this bond at its last outing six weeks ago. The other two tranches brought lower yields from their equivalent earlier outings.
SWAP RATES UNCERTAIN
Wholesale swap rates might be little-changed today. Our chart below records the final positions. The 90 day bank bill rate is down a sharp -7 bps at 5.64%. The Australian 10 year bond yield is down -3 bps from this time yesterday at 4.15%. The China 10 year bond rate has dropped to 2.38% and down -1 bps. And the NZ Government 10 year bond rate is down -3 bps to 4.81%, while the earlier RBNZ fixing was at 4.77% and down -10 bps from yesterday. The UST 10 year yield is now at 4.28% and down -1 bp from this time yesterday. The UST 2yr is now down to just on 4.66% and so that key inversion is now -38 bps and again marginally less.
EQUITY WINNERS & LOSERS
The NZX50 is up +0.3% in late trade today, rising after the OCR decision. The ASX200 is down -0.2% in early afternoon trade. Tokyo has also opened down -0.2%. Both Hong Kong is down -0.2% and Shanghai has opened up +0.3%. Singapore is down -0.5% at its open. Wall Street ended its Tuesday session up +0.2% on the S&P500 index.
OIL EASES SLIGHTLY
Oil prices are -50 USc softer than this time yesterday, now just on US$78/bbl in the US while the international Brent price is now at just on US$82/bbl.
GOLD HOLDS
In early Asian trade, gold is now at US$2035/oz and up a minor +US$3 from this time yesterday.
NZD EASES FURTHER
The Kiwi dollar has slipped slightly from this time yesterday, now at just on 61 USc. Against the Aussie we are little-changed at 93.8 AUc. Against the euro we have dipped a bit more to 56.3 euro cents. That means the TWI-5 is now at just over 70.1 today and down a bit less than -20 bps.
BITCOIN RISES SHARPLY AGAIN
Bitcoin is still moving up. The price has risen again today, now at US$61,357 and up a heady +7.7% from this time yesterday. Volatility has been extreme at +/- 6.4% today.
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44 Comments
All the major exchanges crashed today under demand.
For the first time in 2 years, people at work are asking me about Bitcoin.
The vast public had no idea bitcoin was doing well until now, and didn't want a bar of it during the bear market.
I bought a tiny bit at 60.8k but my average cost is well down in the low 20ks. I'm content now to wait for a bit.
If the coinbase app goes to number 1 again I'm out and sitting on the beach for a while!
Cheery pick to your hearts content Boomer...then come back to me after reading the following
Bitcoin was the best-performing asset of the decade. The data examined the 17 top-performing assets between 2011 and 2021 and found that since 2011, Bitcoin's cumulative gains have exceeded 20,000,000%.
Who's buying bitcoin right now? If you didn't buy it 2 months ago, why buy it now? FOMO? Greater fools? The next billionaires?
Saylor. The man is a beast. The MicroStrategy treasury (193k Bitcoin) jumped in fiat value by USD470 million in 5 hours the other day. If the software business makes $75M per year, that means 6.3 years worth of work by the entire company was potentially captured in just 5 hours.
Bitcoin bull Michael Saylor nets $700 million on three-day pop in crypto.
https://www.cnbc.com/2024/02/28/bitcoin-bull-michael-saylor-nets-700-mi…
Did anyone buy MSTR last month (my comment to someone looking to invest in US stocks at the time)?
Have kicked myself for not buying it in 2020-21 when Saylor had his Eureka moment. In many ways, exposure to MSTR was a no-brainer.
American mate (getting close to 70 yo) bought it. He also bought RIOT in late 2022. An enlightened boomer.
Boomers are smarter than you give them credit for? The vast majority of GenZ and millennials have missed the Bitcoin rally, what's their excuse?
Interesting cat. Accountant by profession but didn't fit well into the corporate world. Took years off salaried life to trade commodities. On the libertarian spectrum. Tells stories about smoking plenty of dope at UC Berkeley. Like Scott Galloway.
Boomers are smarter than you give them credit for?
There will be kids sitting in their bedrooms leveraged to the hilt on all kinds of sh*tcoins - some will become millionaires and many will be wiped out.
It's ironic that there is a certain boomer attitude will look at this with scorn, while believing that their property portfolio is a result of their acumen and good sense.
https://www.youtube.com/watch?v=zcSlcNfThUA
I couldn't put it better.
Absolute ponzi - just like a fair percentage of fiat-currencied forward bets.
There was no shortage of demand for the New Zealand Government bonds issued today.
Bonds are “safe”? Think again, they have also had large, extended drawdowns, UBS Yearbook shows. Link
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