A review of things you need to know before you sign off on Monday; underwater estimate, kiwifruit to the rescue, rush for debt & equity funding, ACCC moves against supermarkets, swaps & NZD hold, & more

Here are the key things you need to know before you leave work today (or if you work from home, before you shutdown your laptop).

MORTGAGE/LOAN RATE CHANGES
The Police Credit Union cut its rates. a href="https://www.interest.co.nz/borrowing">All rates are here.

TERM DEPOSIT/SAVINGS RATE CHANGES
China Construction Bank raised their 6 and 9 month TD rates but cut all others. Bank of India trimmed rates too. All updated rates less than 1 year are here, for 1-5 years, they are here.

AN UNDERWATER REVIEW
Our review shows some 24,000 households are likely facing the biggest mortgage payment increases with some also being tipped into negative equity.

KIWIFRUIT SAVES US
In August, compared with the same month a year ago, goods exports were virtually unchanged $5.0 bln in the month, kept up by strong kiwifuit exports. Imports fell -$70 mln of -1%, to $7.2 bln. So the monthly trade balance was a deficit of -$2.2 bln. Despite its size, that is the smallest trade deficit for an August since 2021, and unlike the other recent Augusts this one was boosted by a large aircraft purchase. August or September are usually the months were we record unusually large deficits.

EXPORTS TO CHINA RETREAT
We used to run a large surplus with China. But that is now evaporating, with an August deficit of -$466 mln. Our love of cars has done that. Ditto Korea where our deficit is an even bigger -$502 mln in the month. With our other larges trading partners - the US, Australia, Japan - we are basically in balance in the month. For the full year to August 2024, our surplus with China fell by $806 mln, with Korea our deficit rose by more than $1 bln. But with the US our surplus rose by $1.9 bln, our surplus wit Australia rose by $509 mln, and with Japan our deficit fell by $304 mln.

COVERED & COMPETITIVE
Listed general insurer Tower (TWR) says it has successfully renewed its reinsurance program for the 2025 financial year and secured comprehensive cover for its home, motor, boat and commercial portfolios across its NZ and Pacific markets at “competitive rates”. Tower has increased its catastrophe upper limit by $50 million to $800 million and expanded cover for a third catastrophe event from $75 million to $85 million. In the 2025 financial year, Tower says it has estimated that it will pay 11.7% of total income for reinsurance cover in FY25, down from 13.9% from the prior year. Tower’s Chief Financial Officer Paul Johnston says the company’s “comprehensive” FY25 reinsurance program will help Tower maintain competitive pricing for customers.

NZX EQUITY MARKET UPDATE
Check out our quick update of how the NZX is faring today, as at 3pm. Investor, NZX & Vista rise, Conact, A2Milk, and Mainfreight fall

TOYOTA'S APPETITE STRONG
Toyota Finance NZ has launched a $250 mln debt fundraising (enough for 10,000 vehicle loans @ $25,000 each). It will be unlisted and rated A+ because the Japanese parent will stand behind it. They will be a mix of 3 year floating rate Notes, and 7 year fixed rate bonds.

SBS BANK WANTS SOME TOO
And SBS Bank says it will probably seek up to $125 mln in 5½ year, unsecured, senior, fixed rate bonds soon.

IN A TOUGH SPOT
Slightly more desperately, construction giant Fletcher Building says it wants to raise $700 mln from shareholders to pay down debt. It needs to do this quickly to prevent a fire sale of assets.

'LOWEST PRICES ARE JUST THE END'
In Australia, their competition regulator is taking on the two dominant and giant supermarket chains (Coles & Woolworths), alleging that ‘Prices Dropped’ and ‘Down Down’ claims and the like are actually misleading.

SURPRISE LIQUIDITY INJECTION
In China today, their central bank unexpectedly lowered the 14-day reverse repurchase rate by -10 bps to 1.85% today (September 23, 2024). They also injected ¥75 bln in liquidity into the banking system. And they pumped in up to another ¥160 bln via 7-day reverse repos, but kept the rate unchanged at 1.7%.

SWAP RATES LITTLE-CHANGED AGAIN
Wholesale swap rates are probably little-changed at the short end. Our chart below will record the final positions. The 90 day bank bill rate is -2 bps lower at 4.97%. That is its lowest level in 280 days. The Australian 10 year bond yield is up +6 bps at 4.01%. The China 10 year bond rate is holding low at 2.05%. The NZ Government 10 year bond rate is up +4 bps at 4.25% and the earlier RBNZ fix was at 4.20% and up +1 bp from Friday. The UST 10yr yield is up +4 bps at 3.75%. Their 2yr is now at 3.60%, so that curve is more positive, now by +15 bps.

EQUITIES MOSTLY HIGHER, EXCEPT THE NZX & ASX
The NZX50 is down -0.5% in its late Monday trade. The ASX200 is also down -0.5% in afternoon trade. However Tokyo is closed today for a public holiday. Hong Kong is up +0.7% at its open and Shanghai is up +0.6%. Singapore is up +0.5% at its open. Wall Street currently looks like it will open strongly tomorrow, the the S&P500 futures indicating a +1.3% gain.

OIL FIRM
The oil price is up +50 USc from this morning at just under US$71.50/bbl in the US, and now just under US$75/bbl for the international Brent price.

CARBON PRICE FIRMS
The carbon price has moved slightly higher today to $61.75/NZU. Volumes traded are still light. See our new daily chart tracker of the NZU price for carbon, courtesy of emsTradepoint.

GOLD STAYS UP
In early Asian trade, gold is up +US$5 from this morning at US$2626/oz and hovering near its record high.

NZD HOLDS
The Kiwi dollar has stayed up, still just under 62.4 USc Against the Aussie we have dipped -20 bps to 91.4 AUc. And against the euro we still at 55.9 euro cents. This all means the TWI-5 is holding at 69.8 and unchanged from this morning.

BITCOIN UP AGAIN
The bitcoin price is up +1.2% from this time morning's open, now at US$63,802. Volatility of the past 24 hours has been modest at just on +/- 1.3%.

This soil moisture chart is animated here.

Keep abreast of upcoming events by following our Economic Calendar here ».