A review of things you need to know before you sign off on Monday; more rate cuts by big banks, limp auction market, Westpac switches auditors, farmers not as grumpy, swaps slip, NZD unchanged, & 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
ASB changed its fixed home loan rates for a third time in two weeks. Kiwibank changed theirs too. Details here. In addition, the Police Credit Union also trimmed two rates.

TERM DEPOSIT/SAVINGS RATE CHANGES
ASB cut their 1 year TD rate by -10 bps. They also trimmed their 4 and 5 year rates. Unity Money also reduced rates across most terms.

LOTS OF AUCTIONS, FEW SOLD UNDER THE HAMMER
Plenty of homes were on offer in the auction rooms last week (573) and that was more than double the number in the same week a gear ago. But the sales rate is stuck at one-third.

WESTPAC SWITCHING AUDITORS
Westpac NZ is following the lead of its Australian parent and moving to appoint KPMG as its auditor from October this year, replacing PwC. The bank says the change comes after a competitive tender process.

LOWER PRESSURE
Suppliers are raising their prices to supermarkets at a much reduced pace. The annual average increase in the cost of goods suppliers charged supermarkets is now at its slowest since the end of 2021. Costs are still rising – just at a much less intense pace than a year ago. The Infometrics-Foodstuffs New Zealand Grocery Supplier Cost Index shows an average +3.7% increase in what suppliers charged Foodstuffs supermarkets for goods in February compared to a year ago. But the last food price index from Stats NZ recorded a "grocery food" rise of +5.7% in the January year. The next Stats NZ update for February comes on Wednesday. Then we will see whether the reduced supplier pressure is translating into the same for retail customers.

HOPE DISCONNECTED FROM PROFITABILITY TRACK
Farmers report to their peak industry body (Federated Farmers) that production will increase in the coming year, but that more of them will become unprofitable. Despite that, there was a tiny lift in farmer confidence (or more realistically less pessimism). That is being attributed to the change in Government. How long that will last if more do slip into unprofitability is anyone's guess.

DAIRY PAYOUT LEVEL SETTLING IN
Rabobank has tweaked its 2023/24 dairy payout forecast up by a minor +5c to $7.80/kgMS for the current season. Rabobank have the lowest forecast of all the main analysts, but it does match Fonterra's mid-point forecast.

TRUST TAX RATE TWEAKED
The tax rate on trusts is to be tweaked again. A $10,000 trustee income de minimis threshold is coming. This means that trusts with no more than $10,000 of trustee income per year will continue to be taxed at 33% rather than the top rate of 39%. As a result, only about 49,000 of the 400,000 trusts in New Zealand are likely to be impacted by the change to the top rate, the Government estimates. Trusts with more trustee income will still be subject to the 39% rate on their trustee income.

ROADS & BRIDGES
Simon Bridges has been appointed to chair Waka Kotahi/NZTA (although the new government won't like the reference, with its new culture-war cleansing of non-English department names). He replaces Dr Paul Reynolds who was a public service insider who have environmental credentials. It might be that Simon Bridges is the first Maori to head the department, one with a budget of about $10 bln/pa, and one that the new government has charged with an increasingly active role in upgrading our roading infrastructure.

STRESS LEVELS ON WATCH
In Australia, the peak body representing financial regulators, The Council of Financial Regulators, (The RBA, APRA, ASIC and the Australian Treasury) released the points they are talking about in a quarterly statement. The main issue seems to be the rise of hardship among borrowers, and the increase in the share of households who had fallen behind on loan payments (although from historically low levels).

BUSINESS TO THE RESCUE
The earlier official reports that Japan had slipped in to recession have proven incorrect. Their revised and updated data shows in fact it expanded at a healthy rate, driven by strong capital expenditure in the business sector. Private consumption, which accounts for more than half of Japan's GDP, remained weak at -1.0%, slightly lower that the preliminary -0.9% decline.

REMINDER
If you haven't done so yet, we would appreciate it if you could complete our car insurance survey. More about it here. The survey itself is here.

SWAP RATES SOFT
Wholesale swap rates are probably still in retreat today. Our chart below records the final positions. The 90 day bank bill rate is unchanged again at 5.65%. The Australian 10 year bond yield is down -2 bps from yesterday at 3.97%. The China 10 year bond rate is now back at a low 2.29%. And the NZ Government 10 year bond rate is down -4 bps at 4.66% and its lowest since late January, while the earlier RBNZ fixing was at 4.61% and down -3 bps from Friday. The UST 10 year yield is now at 4.06% and down -2 bps from this morning. The UST 2yr is now down to just on 4.48% and so that key inversion is little-changed at -42 bps.

EQUITY WINNERS & LOSERS
The NZX50 has started the week with a -0.7% retreat. The ASX200 is down -1.5% in early afternoon trade. The commodities sector is behind the weakness. Tokyo has opened down a sharp -2.4%. Hong Kong has opened strongly however, up +0.9%. And Shanghai has opened with a minor -0.2% dip. Singapore has opened also down -0.1%. The S&P500 futures suggest Wall Street will open tomorrow with a good +1.4% rise.

OIL SLIPS
Oil prices have receded -50 USc so far today at just over US$77/bbl in the US while the international Brent price is now just under US$81.50/bbl. Worries about easing demand from China are behind the retreat.

GOLD UP YET AGAIN
In early Asian trade, gold is now at US$2182 and up +US$3 from this morning, and just off its all-time high of US$2189/oz reached a few hours ago..

NZD ON HOLD
The Kiwi dollar is still at 61.8 USc and unchanged from this morning. Against the Aussie we are also unchanged at 93.3 AUc. Against the euro it is the same 'unchanged' level at 56.5 euro cents. That means the TWI-5 is still holding at 70.5 today.

BITCOIN SOFTENS
The bitcoin price is slightly softer at US$68,291 and down -2.0% from this this morning's open. Volatility has been modest at +/- 1.9% today.

This soil moisture chart is animated here.

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