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 Cooperative Bank trimmed most of its fixed rates today to stay competitive. In fact its 6 month rate was market leading at 5.25%. Westpac then matched ANZ and Kiwibank at 5.29% for a six month rate with a late move, changing two other rates, one down, one up. All rates are here.
TERM DEPOSIT/SAVINGS RATE CHANGES
Rabobank and the Cooperative Bank each trimmed rates, and now very few banks have 4%+ rates on offer. Xceda cut rates too late yesterday. Late today, Westpac trimmed most TD rate offers out to nine months levaing longer rates unchanged. All updated term deposit rates less than 1 year are here, for 1-5 years, they are here.
STILL IN THE DOLDRUMS
Electronic card data for May retail activity shows that even after excluding the impact of falling petrol prices, core retail sales fell again; 'spending has effectively been tracking sideways despite falls in petrol prices'
THIS TIME, NO RESTRAINT
Some local authorities are about to release their 2025/26 rates bills. If you live in one of them you will not want to know that StatsNZ released data today that shows rates and 'regulatory income' (fees, to you and me) rose +11.9% in the March 2025 quarter from the same quarter a year ago. You have to go back to 2007 to find a faster rise. But the latest one is unique in that for the past seven quarters, that annual rate of increase has exceeded 10% for seven quarters. There has never been an historic period of such extended upward pressure from rates. Previous jumps have been one-offs, followed by restraint.
CRIMINAL LENDING ALLEGED
The Commerce Commission has filed criminal charges in the Auckland District Court against an unregistered and uncertified lender, Ilaisaane Malupo, trading as Nane Easy Loan Finance Services NZ (Nane Loans). The Commission alleges Ms Malupo provided personal loans illegally to members of the Tongan community in South Auckland from March 2024. Alongside the lack of certification, the Commission alleges Ms Malupo’s terms included high interest rates of up to 15% charged on a weekly basis, which would double if borrowers failed to repay the loans within 28 days; and late payment fees of up to $10 per day.
NZX50 SLIPS LOWER
As at 3pm, the overall NZX50 index is marginally softer so far today. It is down -0.2% from yesterday, but unchanged for the past week. It is down -3.7% since the start of the year although up +7.2% from this time last year. There were gains for Kathmandu, The Warehouse, Heartland and Channel Infrastructure but Ryman, Tourism Holdings, Hallensteins and Fletcher Building were among the biggest decliners.
BOND TENDERS POPULAR
Treasury tendered $475 mln in three maturities today, one of which was for inflation-indexed bonds, attracting 113 bids and more than $1.8 bln in offers. Yields rose about +10 bps from the prior equivalent tenders two weeks ago.
'DUMB, DANGEROUS & DISHONEST'
This international survey will be no surprise to most readers, and although New Zealand isn't included, it is likely that we would record even more negative opinions than Australians. No wonder Dutton lost in a landslide.
NO MORE FULBRIGHT SCHOLARSHIPS?
In the US, the full board of the US Fulbright Scholarship program has resigned en masse today after Whitehouse officials inserted themselves to punish or reward applicants irrespective of the merits of their applications. The Fulbright Scholarship programs will now probably die. (Separately, but kind of related, AUKUS is also likely to die quickly too from Whitehouse intervention. The US is becoming more than just 'unreliable', it is turning directly incoherent and hostile.)
INFLATION FEARS RISE
In Australia, the Melbourne Institute survey for June shows inflation expectations there rising to 5.0%, the highest level since July 2023 and up sharply from the 4.1% in May.
SWAP RATES ON STILL HOLD
Wholesale swap rates are likely a touch lower today. Keep an eye on our chart below which will record the final positions closer to 5pm. Notice it isn't falling. The 90 day bank bill rate was down -1 bp at 3.31% on Wednesday. The Australian 10 year bond yield is down -5 bps at 4.22%. The China 10 year bond rate is down -1 bp at 1.68%. The NZ Government 10 year bond rate is down -2 bps at 4.61% but was unchanged at 4.61% in the earlier RBNZ fix today. The UST 10yr yield is now down -6 bps to 4.40%.
EQUITIES DRIFT AGAIN
The NZX50 is little-changed again, down -0.2% so far today, and the ASX200 is up +0.2% in afternoon trade. Tokyo is down -0.7% in early Thursday trade. Hong Kong is down -0.4% at its open while Shanghai is up +0.1%. Singapore has opened up +0.2%. Wall Street ended its Wednesday trade with the S&P500 down -0.3% largely because the London talks resolved very little. After it closed, Trump came up with some recycled tariff threats. The futures market suggests this means the downward drift will continue tomorrow.
OIL RISES SHARPLY, BY ALMOST +4%
The oil price is down almost +US$3 at just under US$68/bbl in the US, and just over US$69/bbl for the international Brent price.
CARBON PRICE HOLDS
The carbon price is holding at NZ$56.76/NZU on a few more trades. The next official carbon auction is on Wednesday, June 18, with a $68 floor price. So it will fail. See our daily chart tracker of the NZU price for carbon, courtesy of emsTradepoint.
GOLD FIRMER AGAIN
In early Asian trade, gold is up +US$36/oz from yesterday at US$3373/oz.
NZD MARGINALLY SOFTER
The Kiwi dollar is down -10 bps from yesterday at 60.2 USc. Against the Aussie we are little-changed at just under 92.8 AUc. Against the euro we are down -50 bps at 52.3 euro cents. This all means the TWI-5 is now at 68.1 and down -20 bps..
BITCOIN DIPS
The bitcoin price is now at US$108,516 and down -1.1% from where we were this time yesterday. Volatility has been low at just under +/-1%.
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31 Comments
Another govt IT project fail, $23M more of other people's money.
https://www.rnz.co.nz/news/political/563154/internal-affairs-to-have-an…
Yes, this is a classic rort that constantly happens through poor management decisions:
1. Create an RFP, open internationally
2. Focus on the cost over all else, give contract to lowest bidder (often "Australian")
3. "Australian" company farms the work out to India via outsourcing (look up that company, you will see it instantly).
4. The company charges western rates, pays its Indian subcontractors peanuts, doesn't get anything right, but has won the contract and will keep it going for as long as possible.
5. The managers in the government department have moved on, so nobody is accountable
6. After company misses so many deadlines its ridiculous and still has nothing to show for the work, the government department pulls the plug
7. Government department starts again, rinse and repeat. This was exactly how Novopay went down, along with a tonne of other projects.
5. The managers in the government department have moved on, so nobody is accountable
Not necessarily accountable even if they don't move. One of the problems with public procurement is that they're often intimidated by supplier brands. For ex, you usually aren't held to account for contracting with the likes of McKinsey, BCG, KPMG.
It was explained to me quite candidly by a long term employee at our council that consultants are preferred firstly because it saves the staff from being exposed as either unwilling or incapable of doing the work themselves and secondly and more importantly the consultant invariably has a disclaimer built in to absolve them of any liability. That way if the project goes pear shaped the council can blame the consultant and no one can actually be made accountable . Pretty smooth operation, self preservation at its best.
Bingo
BTW, it happens in the private sector as well.
Also, in South-East Asian countries, the likes of McKinsey have been known to do master economic plans for regions and public initiatives. They typically think that if McK does the work, that is an endorsement for FDI.
Come on Blobbles TCS are not that bad are they?
They do love spending your money to define success / acceptance criteria....
Ha haa, if you know, you know. Sounds like you absolutely know...
This is indeed basically exactly what happens.
Sounds similar to that famous teachers payroll. All govt IT should be done by Kiwi firms with all staff in NZ. This isn't being nationalist; it is experience of a lifetime of programming. Programmers are a strange breed; they are proud and strongly attached to their work. They would either work 16hours a day, seven days a week to resolve problems or they would decapitate the analysts trying to modify the spec. So if Novopay had been a NZ project then all the programmers would have grown beards, changed their names and left the country with no forwarding address for family and friends.
All profits and income tax staying in NZ would be a secondary far lesser benefit.
Yep. Agree with that wholeheartedly. We need to believe in Kiwi capability and ingenuity - as well as Kiwi pride.
It is not pride in being Kiwi or any other nationality. Coding is a creative art and a battle - the effort required leaves you are just too embarrassed when producing mega-crap. As I read it the Novopay creative staff found new jobs elsewhere in Oz but if they had been in NZ that would have been insufficient; their new colleagues would have given them hell.
Might even come to pass that we would then build an industry from that with an international ability without need for subsidizing.
Nah stupid thinking. As you were.
Edit without
Yes, that was my Novopay comment. Was exactly the same situation, won by an "Australian" firm Talent2... who handed it off to (mainly) Indian contractors to do the work. But it was sooo shoddily communicated, architected and programmed, after 4 years it sill had massive bugs.
I suspect most of these rates rises relate to the three waters; so much deferred maintenance that has been investigated and reported since this 2006/07 review.
Which is why Labour tried to centralize it.
In short, over decades we had 'glory projects' instead of boring old 'stuff'; like sufficient storm water infrastructure, safe drinking water; and modern and sufficient sewerage treatment plants.
But, the majority of Mayors decried the fact the Government was trying to 'take' their assets - more like, take them - and their liabilities - off their hands!
I wish it was going to be central government funded, as it is, this is a LG and ratepayer debt-crisis in the making.
Local body rates are already overly burdensome. Here in Christchurch a well established councillor was quoted as saying something like - we hear you, you want us to give priority to basic services, yes, yes we hear you. Firstly why did such need to be told that in the first place and secondly why have the ear plugs only just now been removed. Why is it so unimaginably difficult to get local body councillors, executive and staff to understand that their constituents just want the funds they pay via rates to be spent on things they need rather than things they neither need nor want.
Agree Fox but it also shows why Kate's view of three waters is right. Everyone wants water but no one wants to pay. Especially when it comes to waste water. Have many wondered what happens to the remains of digested meals after you flush the toilet. I would suggest very few.
The 'glory projects" got out of control after Labours 2002? Local govt Act which allowed councils a general competence in community wellbeing - a visible shiny new toy to distract councils from underground services that are invisible to the general public until they fail
Coupled with a low voting engagement from communities which is understandable given the powers allocated to unelected Council managers & staff. Then there's the abysmal std of typical council election candidates.
The results have been plain for a couple of decades and no one in Central govt has had the will to rein it in.
A law change back to allowing only ratepayers to vote would be a start.
It was illuminating the see the batshit crazy priorities different councils had after the cyclone. It's like they hate the rate payers and want to rub their face in it at every opportunity.
Same thing in ChCh post EQs. Dreamed up the craziest schemes imaginable. For instance Gloucester Street destroyed the wonderful view to the west over the bridge by plonking the convention centre right over it when there was nothing wrong with the old site adjacent to the much vaunted town hall. Devised a bus exchange that required traffic flow against a one way street. Demolished a brand new consented building to fancy up Manchester St which resultantly was so obstructive nobody would willingly use it. Sitting in council rooms, without windows, playing around like 10 year olds with Dinky toys.
It was actually the 2002 legislation that was the first to require Council's to prepare a 10-year Long Term Plan.
Financial planning by LAs had prior only required an Annual Plan - and so once the LAs started looking at asset management over a 10-year term, the dye was cast (and the prior game of 'I'll get elected based on keeping rates low') was exposed as the disaster it was.
The infrastructure deficit was finally evident - to not only elected members, but the (paying attention) public as well. And the double-digit rates rise (previously unheard of) started being forecast at that time.
But, you are right - in addition to exposing the looming infrastructure financial crisis - the LGA 2002 also introduced 'Community Outcomes' as a framework for collaborative/community planning. I was living in Kāpiti at the time, and despite having an aging - but quite adequate place to teach kids how to swim and to do laps in - a very vocal "Swimming Club" wanted a new Olympic sized 'aqua-center'. Cutting a long story short, (although mightily contested by many) it got designed and built with every bell and whistle called for by the community - at a 100% cost over-run (actually I think it might have been more, much more). That started off the debt trap they've been stuck in for years. All the while, growing in population at one of the higher rates in the country.
Recipe for disaster.
But, not to blame on the LGA 2002. the 10-year plans have been there for all to see since 2003/04.
Bollo-ck as usual from kknz and profile.
'There has never been an historic period of such extended upward pressure from rates.'
That, right there, is the kicker. A record - meaning no 'precedent', no 'cyclical' - meaning outside the moronic understanding of economics.
We are approaching the resource and energy Limits to Growth on this planet, and we've chosen to avoid maintenance (to avoid parrying entropy) of recent times, rather than address the diminishing returns head-on.
Pigeons. Roost. From here on, 'costs' will increasingly outpace 'abilities to pay' - indeed they have been doing so for some time.
Overall an obviously arguable point. But be it right or be it wrong, it offers no excuse to dumb fruitless decisions made by self satisfied dolts with no more thought than their own ego, position and power. And, from your history here, you yourself have likely encountered more of such than the average Joe Blow on the street. For example , there is fennel spreading all along the council reserve on our street. Why s that a problem. It is a noxious weed. Well yes it was but we took it off the list so it isn’t anymore so it can’t be a problem.
I did a stint on a Local Council once - started 39 years ago!
The problem is one of perspective; there were a lot of self-interest people round the table (farmers, mainly). That period traversed the '87 crash - most of them turned up to the next meeting looking shell-shocked. Me - who had and still has never bought a share in my life - just looked around in wonder - it had been so obvious for so long that it was an unproductive Ponzi.
Actually I have owned - but not actively bought - shares. And learned a valuable lesson from it; Roslyn Woollen Mills was a place I worked shift, and when thy got into trouble, they offered the workers shares instead of part of their pay. In hindsight, it was fraud; they knew they were going under. I left for Australia, cashed mine in and left. They went tits-up a few months later. I read about that and became one notch less naive.
But Local Authorities are in a hiding-to-nothing place right now - and the KKNZ's of this world are working hard to blame some 'other' or other. As the others will blame their others. They're all missing the point; global EROEI is diminishing while entropy is increasing. Exponentially in both cases...
Amen.
Three waters and co-governance. The 3 waters may have had some benefit. Spoilt by co-governace which is a no no for me.. I know NP and probably others had to hand over the funds set aside for 3-waters to the govt. Well surprisingly I understand those funds were re-allocated to other projects in NP so zero or very little was handed over to the govt.. Now that three waters is off the table. NP ratepayers are on the hook for replacing those 3-waters funds. My main concern was that if 3 water had gone ahead even with co-governance , there would be no change in total Council, spending whether capex or opex. The council would not reduce rates.
I think everyone deserves to see where the 3waters money went as the councils were paid decent sums by labour 2022 if memory serves. Probably plundered for vanity projects and high staff salaries as there would be no accountability for it.
Might want to correct a small typo: "The oil price is down almost +US$3"
Gold has flipped the euro to become the world’s second-largest reserve asset, trailing only the U.S. dollar in value held by global central banks.
USD: 46–47%
Gold: 19–20%
Euro: 16%
https://www.cnbc.com/2025/06/11/gold-overtakes-euro-as-second-biggest-g…
Aussies should stick to their franking credits and the marriage between CBA and the Ponzi.
Australia’s largest super fund, Australian Super, is invested in Israeli companies linked to war crimes in Palestine, including a manufacturer of the deadly white phosphorus, which has been used in IDF attacks on crowded civilian areas in Gaza and Lebanon.
AusSuper holds shares in both Elbit Systems, Israel’s biggest weapons manufacturer and ICL Group (formerly Israel Chemicals Ltd.
https://michaelwest.com.au/australian-super-profiting-from-genocide/
The 12% increase on last years $53.3 billion is being hailed by the Director General of MPI Ray Smith as a ‘blockbuster year’. He says there is a good chance that by 2029, the figure will be close to $66 billion.
https://ruralnewsgroup.co.nz/rural-news/rural-general-news/nz-primary-e…
"Australia is a housing bubble with an economy attached"
Check out the the h'hold debt to income chart. Aotearoa included. World beating.
While healthy banks are a positive, bank profits are earned from lending to a relatively unproductive asset class: residential property. The national obsession with loading up on debt to build wealth from property is likely contributing to stagnant productivity, a lack of business dynamism and failure to produce more world-leading businesses.
Our household debt is the third-highest among rich club Organisation for Economic Co-operation and Development nations, overwhelmingly due to high house prices…
“Our big companies on the ASX lend largely into a non-productive asset class, which is established housing,” [Alex] Joiner says. “If we want to be a highly productive economy, we need companies that can do that”…
It’s not surprising that bank values have soared because the size of the home loans they grant is directly related to property prices…
https://www.macrobusiness.com.au/2025/06/australia-is-a-housing-bubble-…
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