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
There are no changes to report today. All rates are here.
TERM DEPOSIT/SAVINGS RATE CHANGES
Rabobank lowered its term deposit rates for all terms of 2 years and longer. Their more popular shorter terms have been left unchanged however. All rates less than 1 year are here, for 1-5 years, they are here.
A 1°C RISE IN 42 YEARS IS A 'HEATWAVE'
Stats NZ says between 2022 and 2023, our oceanic and coastal waters reached their warmest annual temperatures since the series began in 1982. The have maps in their release with the highest increases shaded dark red. They say since 1982, sea-surface temperatures increased between +0.63°C to +1.05°C across our local oceanic regions, with the Tasman Sea having the highest rise. The Chathams had the biggest ocean anomaly, rising to 14.2°C. The southern South Island had the biggest coastal anomaly rising to 13.6°C. They say the overall +1°C rise over 40 years is an oceanic heatwave. What will they say when it gets to +2°C? Boiling?
TAX FRAUD GETS WFH 'DETENTION' I
An Auckland woman who tried to get nearly $60,000 in COVID relief money was sentenced to 11 months home detention when she appeared for sentence this month. Samantha Paul applied for Small Business Cashflow scheme loans (SBCS) for three unrelated taxpayers, one for her own company, and one in her own name, when she knew she was not entitled to any of the money.
TAX FRAUD GETS WFH 'DETENTION' II
An Upper Hutt man was sentenced to a year’s home detention for tax fraud. Keith Thomas Jaques ran various food vending businesses over the years, mainly selling donuts, coffee and churros at sporting and cultural events. The business operated between Wellington and Auckland and included events at large stadiums such as: Wellington Stadium, Mount Smart Stadium, Auckland and FMG Stadium in Hamilton.
TAX FRAUD GETS COMMUNITY 'DETENTION'
A Northland man was sentenced to community detention on tax fraud charges when he appeared in court this month. William Robert Eskdale pleaded guilty to 28 charges and appeared in the Whangarei District Court where he was sentenced to 4 months community detention with 100 hours community work.
INVESTORS RETURN?
Updated data for new lending in May (C70) shows that 25% of all new residential lending went to property investors, the biggest share since April 2021, and the most volume since December 2021.
BANKS WARY
The same updated data for new lending in May (C70) shows new lending for commercial property (investment, commercial development, residential development) has gone the other way, sinking to 24%, far below the peak 42% of new business lending in July 2021.
DAIRY FARMERS GET IN EARLIER
For many years, the peak in new lending to dairy farmers came in June each year. But updated data for new lending in May (C70) suggests that peak has arrived a month earlier this year, and below the levels of the past two annual peaks. If May really is the peak in 2024, it will be -20% lower than 2023, and -11% lower than in 2022.
EYES ON RBNZ
Financial markets are awaiting tomorrow's RBNZ Monetary Policy Review. We will have full coverage. See our preview here. All forecasting economists and the financial markets expect the RBNZ to remain on hold. Markets will be watching for any shift in guidance. If there is a neutral no-change guidance, the 2yr swap rate could rise about +3 bps due to positioning, speculating on a dovish shift. If there is a dovish shift, the 2yr swap rate could fall -10 bps or more in response.
UNRECOVERED
In Australia, the Westpac-Melbourne Institute Consumer Sentiment survey index fell in July from June. That leaves it broadly in line with the very low levels that started in July 2022. Pre-pandemic these levels were generally +20% higher. So far their 'stage 3' tax cuts have done little to improve sentiment. The biggest declines were among middle income earners, Victorians, and hospitality and construction workers. About 60% of those surveyed now expect the RBA to raise its policy rate, a big rise from 41% expecting that in the June survey.
INDIA TO RISE, CHINA TO FADE
India is about to overtake China as the top driver of global food demand over the next decade, according to recent estimates from the FAO. Southeast Asian nations are on the rise too. The fading of China, due in part to demographic shifts and an about-to-fall population, is a key global trend.
SWAP RATES NOT DOING MUCH
Wholesale swap rates are likely to be little-changed again today and ahead of tomorrow's MPR from the RBNZ. Our chart below will record the final positions. The 90 day bank bill rate is down -1 bp at 5.60%, a level it has hovered around for 125 days now. The Australian 10 year bond yield is down -3 bps from this time yesterday at 4.38%. The China 10 year bond rate is down -2 bps at 2.29%. The NZ Government 10 year bond rate is down -4 bps at 4.68% and the earlier RBNZ fix was at 4.65% and unchanged from yesterday. The UST 10yr yield is down -2 bps from yesterday at 4.27%. Their 2yr is now at 4.63%, so the curve is more inverted, now by -36 bps.
EQUITIES MOSTLY POSITIVE, EXCEPT HONG KONG
The NZX50 is up +0.2% from yesterday in late trade. And the ASX200 is up +0.7% in afternoon trade. Tokyo is up +1.5% at its open, the best of the markets we follow and again pushing new all-time highs. Hong Kong is down -0.4%, and Shanghai is little-changed to open their day's trading. Singapore is up +0.3%. Wall Street ended its Monday trade with the S&P500 up an insignificant +0.1%.
OIL SOFTISH
The oil price is down another -50 USc at US$81.50/bbl in the US, and at just over US$85/bbl for the international Brent price.
GOLD LOWER
In early Asian trade, gold is down -US$19 from yesterday at US$2364/oz.
NZD SLIPS
The Kiwi dollar is down about -¼c from this time yesterday, now at 61.2 USc. Against the Aussie we are down a bit less at 90.8 AUc. Against the euro we are also down -¼c at 56.5 euro cents. This all means the TWI-5 is now just under at 70.4.
BITCOIN BOUNCES BACK
The bitcoin price has bounced back a bit, now at US$57,199 and up +3.5% from yesterday's low. Volatility of the past 24 hours has been high at just under +/- 3.0%.
AND IN CASE YOU WERE WONDERING
There are now less than 160 days until the end-of-year Christmas break.
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