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
No changes to report today but new NBDT, Welcome, is now covered in our tables. All rates are here.
TERM DEPOSIT/SAVINGS RATE CHANGES
No changes here today. All updated term deposit rates less than 1 year are here, for 1-5 years, they are here.
MARKET STALLING
The June REINZ data shows a fourth consecutive monthly fall in their house price index. And the same data shows sales volumes also took a dive in June.
LOWER RATES, MORE INTERVENTIONS
Ageing population will push interest rates lower, the RBNZ says. It also says it will increase the risk that central banks will have to intervene during economic shocks
SETTLING IN AT 2%
The pace of supplier cost increases to Foodstuffs supermarkets increased slightly in June, with the Infometrics-Foodstuffs New Zealand Grocery Supplier Cost Index showing an average +2.1% increase in what suppliers charged in June 2025, compared to a year earlier. In May the increase was +2.0% on the same basis. In June 2024 it was +2.7%.
NZX50 UNCHANGED TODAY
As at 3pm, the overall NZX50 index is little-changed today, now down -1.4% for the past week. It is now down -3.0% since the start of the year although up +4.6% from this time last year. Briscoes, Heartland, Summerset, and Port of Tauranga post gains; Sky TV, Vulcan Steel, NZX, and F&P Healthcare ease.
EYES ON DAIRY PRICES
There is another full dairy auction tomorrow and it is shaping up to be a small retreat. Recall two weeks ago overall prices fell -4.1% in USD. The derivatives market trading sees the WMP price falling -2.5% but the SMP price rising about +2.5%. We will have coverage in our Breakfast Briefing.
WE HOLD THE SOFT ADVANTAGES WELL, BUT LAG SHARPLY IN THE IMPORTANT STUFF
Auckland Council engaged Deloittes to benchmark Auckland against nine other reference cities; Austin TX, Brisbane, Copenhagen, Dublin, Fukuoka, Helsinki, Portland OR, Tel Aviv, and Vancouver. They have issued their third annual report. It says we have made or held our advantages for Sustainability, Resilience and Culture, and are seeing progress for Innovation and Connectivity even if we still lag in these areas. But they also noted 'red flags' for Opportunity, Prosperity and Knowledge - which won't surprise many in the city.
INCHING HIGHER
In Australia, the Westpac/Melbourne Institute consumer sentiment survey showed a third consecutive rise in July, although a small one. Despite the surprise no-cut by the RBA recently, most consumers still expect interest rates to move lower from here. But they remain uncertain about the outlook for the overall economy and jobs. Housing-related sentiment dipped slightly but price expectations remained high.
THE BATTLE AGAINST SURCHARGING
And staying in Australia, the RBA has reached the preliminary view that it would be in the public interest to:remove surcharging on eftpos, Mastercard and Visa cards. They also want to lower the cap on interchange fees paid by businesses, and require card networks and large acquirers to publish the fees they charge. They are now in the 'consultation' phase, which will no doubt involve fierce pushback. Here the Commerce Commission has been looking at the same issues, and will report on the New Zealand changes they want to see, very soon.
STILL RETREATING
Even if they aren't as steep as they have been over any of the past 15 months, new house prices in China are still falling. Only 12 of the 70 largest cities had prices that held basically unchanged however. But for resales, none were in that category. The lure of housing speculation in China is but a distant memory. For most developers that is trouble. But pockets like in Shenzhen may be seeing a bit of a shine.
"RISING TO THE CHALLENGE" - WHAT THE PARTY ORDERED
Today, China reported that its Q2-2025 economy expanded +5.2% in inflation-adjusted terms from Q2-2024. This was bang on what Beijing had set as a target, and what observers were expecting them to announce. Strong exports and consumer subsidies helped a lot.
"GOOD" SECTOR PROGRESS, BUT WITH CRED ISSUES
China said its retail sales were up +4.8% in June from a year ago, its industrial production up +6.8%. So that suggests they had the best of both worlds - rising industry and rising internal consumption. That they seem to have done this all with only a modest rise in electricity production (+1.7%) would be impressive if itr was believable. They are almost certainly making big strides in energy efficiency but it is unlikely as reported. Despite these cred issues however, it is clear that the Chinese economy is not going backward.
SWAP RATES A TOUCH FIRMER
Wholesale swap rates are likely marginally firmer today. Keep an eye on our chart below which will record the final positions closer to 5pm. The 90 day bank bill rate was down -1 bp at 3.28% on Monday. The Australian 10 year bond yield is up another +3 bps at 4.39%. The China 10 year bond rate is down -1 bp at 1.66%. The NZ Government 10 year bond rate is up +2 bps at 4.61% and was up +1 bp at 4.56% in the earlier RBNZ fix today. The UST 10yr yield is up +2 bps at 4.43%
EQUITIES MIXED
The local equity market is little-changed in late trade. The ASX200 is essentially up +0.4% in Tuesday afternoon trade. Tokyo is up a mere +0.1% in early trade today. Hong Kong is up +0.2% at its open while Shanghai is down -0.5%. Singapore has also opened up +0.1%. Wall Street ended its Monday session little-changed, up a mere +0.1%.
OIL SLIPS
The oil price in the US is down about -US$2 at just on US$66.50/bbl and just on US$69 for the international Brent price.
CARBON PRICE HOLDS
The carbon price is now at NZ$58/NZU but trade only on a tiny trade. The next official carbon auction is on September 10, 2025. See our daily chart tracker of the NZU price for carbon, courtesy of emsTradepoint.
GOLD SLIPS
In early Asian trade, gold is down -US$9/oz to US$3347/oz.
NZD LITTLE-CHANGED
The Kiwi dollar is down a net -10 bps from this time yesterday at 59.8 USc. Against the Aussie we are up +10 bps at just on 91.3 AUc. Against the euro we have also slipped -10 bps to 51.2 euro cents. This all means the TWI-5 is down -10 bps from yesterday, now at 67.4.
BITCOIN SETTLES HIGH
The bitcoin price is now at US$118,308 and down -1.1% from this time yesterday and off its record high.Volatility has been moderate, now at just on +/-1.2%.
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4 Comments
That one year swap rate is flat as a pancake for 3 months now. Where to next...up/down/flat?
Reading Luke Gromen's on China's record USD990 billion trade surplus in 2024.
Luke points out that it would have been a flat balance of trade if China's 2024 gold imports (1,384t) were valued at approx USD22,000/oz.
Conclusion: the issue isn't China's trade imbalance with the U.S. and the world. The issue is USD is wildly overvalued vs gold.
Gold should flow as a response to trade imbalances. Historically, during periods such as the gold standard era, gold would physically flow from deficit to surplus countries as a direct settlement of trade imbalances. This outflow would effectively rebalance trade by decreasing money supply and imports in the deficit country and increasing them in the surplus one, pushing both economies back toward equilibrium.
MARKET STALLING
The June REINZ data shows a fourth consecutive monthly fall in their house price index. And the same data shows sales volumes also took a dive in June.
One mans stalling is another's
DROPPING LIKE A STONE
When a person's income - and mana - are tied up with a narrative, it is obviously hard for them to release hold of it.
We watch...
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