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 RATE CHANGES
The variable rate cuts have flowed from the OCR rate cut and they are summarised here. ANZ cut their's by just -20 bps to 6.69%. ANZ only passed on -20 bps at the April -25 bps OCR cut too. The fixed rates cuts are here. All rates are here.
TERM DEPOSIT/SAVINGS RATE CHANGES
ANZ led the cuts to savings account rates. Details here. All updated term deposit rates less than 1 year are here, for 1-5 years, they are here.
A CUT & GUIDANCE, BUT LESS THAN SOME HOPED FOR
The Reserve Bank cut the OCR by -25 bps to 3.25% as expected, but it also indicated that there may be one more cut this year. But bank economists may have expected and hoped for more trimming than indicated. The RBNZ move wasn't a unanimous decision with one of the six members voting against a cut at this time.
GLOOMY TURN
In April, the labour market takes gloomy a turn, with the 'economy struggling to cast off recessionary shackles'. Monthly filled jobs data shows a decline in April, while figures for the previous two months have also been revised down.
RENTAL YIELDS STAY VERY LOW
There has been a slight improvement in the rental yield and cash flow figures for residential investment properties in Q1-2025, but in the absence of capital gains the numbers are still pretty grim. Many residential property investors are likely facing negative cash flows even though mortgage rates are tumbling.
CO-OP BANK PROFIT HIT BY CCCFA PROVISION
The Co-operative Bank's March-year profit fell 44% to $7.158 million as expenses rose 9% and impairment losses increased. The bank will pay $1.5 million in rebates, down $1 million year-on-year. Co-op says its profitability was also hit by a $4.4 million provision relating to historic credit fees, set under the Credit Contracts and Consumer Finance Act (CCCFA). This comes after it reimbursed some $5 million to customers in relation to these fees in prior years. Co-op says it's working with the Commerce Commission to finalise this matter. The bank's mortgage book grew 6% to $3.2 billion.
PAYMARK PROFIT DROPS
Eftpos provider Paymark's 2024 calendar year profit fell almost $4.5 million, or 21%, to $16.684 million as revenue fell and expenses rose. Now owned by France's Worldline SA, Paymark paid $14 million in dividends, down from $21 million in 2023.
ACCREDITED
The first private issuer of building consents, Building Consents Approvals (BCA), has now been accredited with the MBIE. The Christchurch-based company will operate nationally and promises to issue building consents within 10 working days "for eligible residential projects".
MORE FINES & COMNPENSATION
El Cheapo Cars has been sentenced in the Porirua District Court for its failure to provide key information to borrowers about their loans. The Wellington-based motor vehicle trader and finance lender had pleaded guilty to seven charges the Commerce Commission filed under the Credit Contracts and Consumer Finance Act (CCCFA). El Cheapo Cars has now been fined $115,000 and ordered to pay $341,931.46 in compensation to hundreds of affected borrowers. ComCom opened its investigation into El Cheapo in October 2021, following a customer complaint. The Commission has also filed civil proceedings against Go Car Finance and Second Chance Finance in the High Court, with allegations that both lenders also breached the CCCFA when providing car finance to borrowers.
DAIRY PRICE UPDATE
The overnight dairy Pulse auction saw prices for both SMP and WMP slip although less than the futures market had suggested. The WMP was down -2.7% in USD from the prior week's full event, and a bit more in NZD. To be fair both prices had risen sharply since April. This pullback still leaves them in a rising trend despite today's adjustment.
NZX50 DROPS SHARPLY
As at 3pm, the overall NZX50 index is down -1.8% so far today. And it is down -2.7% for the past week, down -5.4% since the start of the year, but up +5.8% from this time last year. Investore, Kathmandu, Fletcher Building, and Kiwi Property lead the gains, as Infratil, Oceania, F&P Healthcare, and Sky Network are the main decliners.
A INVESTMENT BREATH OF FRESH AIR
F&P Healthcare announced full year results today. They are New Zealand's largest listed company, making sales of more than $2 bln (+16%) and earning more than $377 mln after tax (+30%). More than 22 mln people use their products worldwide. Their share price fell -2.3% on the news today, but is up +3.6% for the month, +29.6% for the year.
EXCHANGE RATE BUMPS
Data out from the RBNZ today (F5) shows their foreign currency intervention capacity fell by -$889 mln in April. This comes after a rise of +$854 mln in March. The new level is $25.8 bln. The recent changes are more likely just exchange rate impacts.
SWAP RATES FIRMISH
Wholesale swap rates may be slightly firmer following the OCR decision. Keep an eye on our chart below which will record the final positions closer to 5pm. The 90 day bank bill rate was unchanged at 3.27% on Tuesday. The Australian 10 year bond yield is down -2 bps at 4.32%. The China 10 year bond rate is up +1 bp at 1.70%. The NZ Government 10 year bond rate is up +2 bps at 4.63% and was down -4 bps to 4.55% in the earlier RBNZ fix today from yesterday. The UST 10yr yield is on 4.47%, down -2 bps.
EQUITIES MIXED BETWEEN THE BIG NZX50 DROP, AND S&P500 RISE
The NZX50 is down -1.7% so far today in solid drop, but the ASX200 is up +0.1% in afternoon trade. Tokyo is up +0.5% in early Wednesday trade. Hong Kong has fallen -0.3% at its open while Shanghai is up +0.1%. Singapore has opened up +0.5%. Wall Street ended its Tuesday trade with a sharpish +2.0% gain on the S&P500.
OIL HOLDS
The oil price is little-changed at just under US$61.50/bbl in the US, and just on US$64.50/bbl for the international Brent price.
CARBON PRICE DIPS
The carbon price is slightly low, down -70c today at NZ$54.30/NZU with slightly more volume. The next official carbon auction is on Wednesday, June 18, with a $68 floor price. See our daily chart tracker of the NZU price for carbon, courtesy of emsTradepoint.
GOLD SLIPS AGAIN
In early Asian trade, gold is down -US$40/oz from this time yesterday at US$3302/oz.
NZD EASES
The Kiwi dollar is down -40 bps from this time yesterday, now at 59.5 USc. Against the Aussie we are up +10 bps at 92.5 AUc. Against the euro we are up +10 bps at 52.7 euro cents. This all means the TWI-5 is now at just over 66.3 and -20 bps softer from yesterday.
BITCOIN HOLDS
The bitcoin price is at US$108,663 and up just +0.3% from this time yesterday. Volatility has been modest again at +/-1.0%.
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38 Comments
Hey, we are still alive. That counts for a lot, when you hear from relations in Europe waiting for the count down to war. Seems the weakling in power in the Whitehouse has been caught out.
Count down to war in Europe ? Care to explain please ?
I guess the countdown stopped 3 years ago - there is war in Europe. I'd be pretty nervous if lived in a Baltic state, Poland or Finland about where it might spread next.
I've seen very little European news about their support for Ukraine thus far - aside from discussion of further sanctions. Has military equipment and ammunitions from the EU and UK started flowing in?
Very tense situation.
Russia has been slowed, not stopped and from all appearances has no intention of stopping. Only a brief look at Russian history will reveal how patient and persevering they are at attrition. The Red Russia has been positioned on Europe’s north east boundary for over one hundred years. The combined efforts of Reagan and Thatcher & Co pushed the iron curtain back to not that far west of Moscow but the subsequent leaders, in their own complacent and desultory manner, decided the old Bolshevik ogres could not rise again. The question now would appear to be how long before Putin’s forces arrive at an actual NATO border and exactly what happens then. Or is it a moments like these you need a Trumpy situation.
Only a brief look at Russian history will reveal how patient and persevering they are at attrition
They were kinda average in WW1, and only put on a good show in the second one due to a massive supply of American armament. And a sojourn in Afghanistan sped the collapse of the union.
They're a former superpower, struggling to come to terms with now being a minor nation.
WW1 the Russia military was outdated and led by an incompetent officer corps, the last of the aristocrats. Having a revolution erupt didn’t much help matters either. As for WW2 Stalin really summed it all up from A to Z. Quantity has a quality all of its own. That mass of expendables and the vast remoteness and shockingly cold elements were a formidable and sufficient defence all are their own. Napoleon could have told Adolf all about that.
Yeah, just don't invade them.
I see no indication that Russia has any interest in invading western Europe.
The Ukrainian fiasco is a local ethnic conflict, nasty, stupid, murderous and unsolvable as those are.
Western Europe, probably not. But there are plenty of people living in Eastern Europe who might not find that very comforting.
Two forays into Ukraine and one into Georgia should tell us it's a bit more than an ethno conflict.
Western Europe is a bridge too far, but Russia certainly has aspirations to shore up it's boundaries, the further out the better.
You think?
Tell us some details on the Georgia 'foray'.
Putin has compared himself to Peter the Great - not good news for those who happen to live in lands once claimed by Russia. The presence of a population of ethnic Russians is a classic casus belli for imperialists.
Same way most of these go, KH. Some "separatists", usually funded, supplied and partly manned by Russia make some noise, and Russia comes to "aid" them. Then people elsewhere can go "meh, some ethnic thing".
The Germans did the same thing in the 30s.
"support for Ukraine". Good question Kate.
1) has US weapon supply to Ukraine completely stopped by now ?
2) how is Europe filling in the lack of weapons being supplied to Ukraine?
(sorry if I don't know the answers to these important questions, reliable help is much appreciated!)
1) has US weapon supply to Ukraine completely stopped by now ?
No.
2) how is Europe filling in the lack of weapons being supplied to Ukraine?
Most of the donated weapons thus far are from European donors as it is, the US hasn't supplied any aircraft, and only a handful of tanks. The biggest shortfall from Europe is anti-air munitions.
Ukraines ability to keep fighting is something Trump had overlooked.
Looked up who has donated the most. Most of the major arms supplied to Ukraine came from the USA (45 per cent), followed by Germany (12 per cent) and Poland (11 per cent).
I think the US have supplied Ukraine with the majority of munitions. Without these, Ukraine is in dire straights.
I think the Polish are itching to get into this war
That's based on a dollar value, and US gear is valued significantly higher than much of what Europe has given Ukraine.
Actual physical weapons is different. Examples of the disparity of some hardware (Europe:USA)
Tanks: 3:1
Infantry Fighting Vehicles 7:1
Howitzers (artillery pieces) 3:1
And 120 odd fighter jets, vs zero.
War would wreck EU exports to Russia though. Borat is stoked.
"How will the EU ever be a credible foreign policy actor if this is the reality: ongoing and massive transshipments to Russia via all kinds of places. Brussels has turned a blind eye for over 3 years."
https://www.euractiv.com/section/economy-jobs/news/eu-sanctions-on-russ…
When do you think Merz will stop exporting stuff to Russia via Turkey? Talks a big game while quietly supplying Russia.
From link above:
https://www.osw.waw.pl/wp-sites/wp-content/uploads/2025/04/Wykres-10-1…
"Prime Minister Christopher Luxon, who joined Willis for a triumphant media briefing in the Banquet Hall at Parliament, said a household with a $500,000 mortgage will find their fortnightly repayments reduced by $300. "
https://www.stuff.co.nz/politics/360605837/live-nz-politics-blog
It was a 0.25% cut to the OCR today?
Stuff can certainly perfect the art of publishing banality. Speaking of which though, it is becoming more and more difficult to understand exactly how Mr Luxon got to think he would be suited to politics let alone a prime ministership.
My math says $48 a fortnight ?
500000 x 0.0025 =1,250 pa or 24 a week
Once this round of OCR cuts flow through, I'd be going long if re-fixing. Can't see anything but a rise in inflation from here on in and the potential for an RBNZ reversal/hold until these US tariff measures flow through and we have some idea of a new normal.
I'd hedge my bets, who knows what's going to happen to our OCR (excepting Yvil who says he knows).
Appears to be a reporting error (misquote)
"Prime Minister Christopher Luxon said the reduction of 25 basis points was "very good news".
"If you think of a $500,000 mortgage, 25 years, it means fortnightly payments have been lowered by over $300 with the interest rates cuts that we've seen since we came to power," he said."
https://www.rnz.co.nz/news/national/562410/reserve-bank-drops-ocr-by-25…
Name a PM and FM in our entire history so devoid of charisma and charm, so incapable of repartee as Luxon and Willis.
Jack Tame eviscerated Willis to the point I had to stop watching. She knew it as well, blushing and squirming, trotting out the same old "what I can Say to you" and "this is the converation we need to have".
The country is slowly recovering, we'll get there.
Witty repartee? You don’t know how close that is the to the name of my old great friend, a wonderful true Maori and locking partner, seniors many seasons many moons ago. We used to laugh about that then as varsity types will do. Sadly don’t think he’s got long to go. The fags that had no affect on his playing may have finally caught up on him. Wish we didn’t know now what we didn’t know then.
That's interesting - I thought she "held up" pretty well :-). Better than I imagined. But, he really had his facts together to throw at her and many of the statistical failures since they got elected couldn't be batted away.
Yes, I well recall Tame & the rest of the MSM taking Ardern to task in the same analytical way for years...oh, wait, that was just batting their eyelashes at each other
It was Grant Robinson in that FM position.
Compare and contrast interview styles. That time Robbo regretted not borrowing enough - Jack bats eyelids. I wonder why Jack never asked Robbo why he was addicted to spending multiple times in a interview?
No, that's a valedictory interview - what you want is a just after a budget day interview. That would be interesting.
Jack never said Robertson had an addiction to spending, let alone twice, in any interview. Robbo was always given a free pass. Do get me wrong I don't agree with Willis spending unborn children's money either - especially with our bleak demographics!
These guys are in fantasy land, claiming that that it's all because of them inflation has come down. They did cut some spending, but it would be a rounding error for all the other things that caused inflation.
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