A review of things you need to know before you sign off on Tuesday; no retail rate changes, ComCom eyes card fee savings, electricity prices spike, emissions fall, swaps hold, NZD falls, & 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 change today.. All rates are here.

TERM DEPOSIT/SAVINGS RATE CHANGES
No changes today, but this review might be useful. All rates less than 1 year are here, for 1-5 years, they are here. Interestingly, there haven't been any reductions to savings account rate yet.

COMCOM EYES LOWER CARD PAYMENTS COSTS
The Commerce Commission is consulting on the costs to businesses and consumers of card payments, saying there's potential to reduce these costs by about $250 million a year. The Commission, which oversees retail payments under the Retail Payment System Act 2022, says consumers spend about $95 billion via Mastercard and Visa annually, which ultimately costs them about $1 billion through high retail prices and surcharges. Commission Chairman John Small says this cost is too high, especially when compared to international peers, meaning there's "potential to reduce these fees by more than $250 million per annum." The Commission may review interchange fee regulation with Small saying there's an "opportunity to reduce a significant component of the merchant service fee, which should in turn allow businesses to reduce retail prices as well as surcharges, for the benefit of their customers." The Commission's seeking feedback on its consultation paper by 4pm on August 20.

ELECTRICITY COSTS JUMP ON IMBALANCE, GETS DIRTIER
Earlier today, electricity stress was high. Lowish lake levels, and still conditions (no wind power) meant that coal and gas generation was unusually high to balance the loan requirements. Also, generation capacity flowed from the North Island to the South Island in a relatively rare reversal. At 6:30 am spot Haywards prices were $610/MHhr, and by 7am had risen to $662/MWhr. Prices were higher in the SI than the NI. "Worse", the fossil fuel generation spike pushed the average CO2 from this generation to 216g/kWhr. So far this year the average has been 115g/KWhr, so almost double. More background here.

FITCH DOWNGRADES TSB CREDIT RATING
Fitch Ratings has downgraded its TSB Bank credit rating to BBB+ from A-. Fitch says this reflects its view TSB's risk profile is no longer significantly stronger than those of domestic regional bank peers. It notes TSB had larger holdings of high-quality non-loan assets relative to peers, but this difference has narrowed over the last few years and it expects this trend to continue over the medium-term. Its outlook on the new TSB credit rating is stable. 

FITCH UPGRADES THE CO-OPERATIVE BANK
Fitch Ratings has also upgraded The Co-operative Bank's credit rating to BBB+ from BBB with a stable outlook. Fitch says the upgrade reflects its expectation Co-op's earnings have been sustainably improved, reflected in a four-year average operating profit/risk-weighted asset ratio remaining above 1.2%, while maintaining other aspects of its credit profile.

FEWER NATIONAL EMISSIONS
Meanwhile, national greenhouse gas emissions fell -2.7% in March quarter, the largest quarterly decrease since the agency started tracking emissions in 2010. Agriculture was one of the many industries that drove the decrease. Household emissions rose. And the energy sector emissions rose sharply. Overall emissions will probably fall as economic activity eases during the rest of 2024. That our export industries are reducing emissions even if the rest of the country isn't. Also, see this.

TINDALL TO REPRISE OWNERSHIP ROLE?
On the NZX, the Warehouse Group has revealed a scheme backed by Stephen Tindall to take back control of the struggling company.

COMMISSIONER APPOINTED
Later yesterday, the Government appointed a commissioner (Dr. Lester Levy) to run Te Whatu Ora/Health NZ after sudden budget blowout of operating costs. Levy replaces the 'board', but was in fact one of the board members. Te Whatu Ora is the consolidation of the previous DHBs. The admin cost savings it was supposed to bring turned into an added deadweight cost.

DAIRY PRICES UNDER PRESSURE
There is a GDT Pulse dairy event tomorrow morning. The futures markets suggest that the SMP price should hold. But the important WMP price might be facing a -2.5% retreat. We will know soon enough.

SWAP RATES HOLD
Wholesale swap rates are likely to be little changed today on international influences. Our chart below will record the final positions. The 90 day bank bill rate was down -1 bp at 5.54%. The Australian 10 year bond yield is up +1 bp from this time yesterday to 4.37%. The China 10 year bond rate is unchanged at 2.25%. The NZ Government 10 year bond rate is down -2 bps to 4.46% and the earlier RBNZ fix was at 4.42% and up +2 bps from this time yesterday. The UST 10yr yield is up +2 bps at 4.25%. Their 2yr is now at 4.52%, so that curve is now inverted by -27 bps.

EQUITIES MOSTLY HIGHER
The NZX50 is up +0.9% in late Tuesday trade. The ASX200 up +0.7% in afternoon trade. Tokyo has opened its Tuesday trade up +0.2%. Hong Kong is unchanged. But Shanghai is another -0.5% lower. Singapore has opened up +0.5%. The S&P500 was up a strong +1.1% Wall Street in its Monday trade.

OIL DOWN
The oil price is down -50 USc at just on US$78.50/bbl in the US, and now down -US$1 at just on US$81.50/bbl for the international Brent price.

CARBON PRICE LOWER
We are going to try and track the daily New Zealand carbon price (probably the prior day's close). There are formal markets but the exchanges are very closed regarding transparency - unless you pay. We think it closed on Monday at NZ$53.08/NZU. (A NZU is the equivalent of a tonne of CO2.) Today at was at $52.30/NZU at 11am and that is down -2.6% from the same point a week ago. It is down from $74.50/NZU at the start of 2024.

GOLD EASES
In early Asian trade, gold is down -US$9 from this time yesterday at US$2399/oz.

NZD LOWER
The Kiwi dollar is down more than -¼c from this time yesterday at 59.7 USc. Against the Aussie we have slipped slightly to 89.9 AUc. Against the euro we are down -¼c at 54.8 euro cents. This all means the TWI-5 is now at 68.8 and down -20 bps.

BITCOIN SLIPS
The bitcoin price is down -0.8% from this this time yesterday, at US$67,645. Volatility of the past 24 hours has been modest at just on +/- 1.3%.

This soil moisture chart is animated here.

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