A review of things you need to know before you sign off on Monday; service sector contracts less, withdrawns point to unrealistic sellers, MVM sold for a big loss, businesses expect higher inflation, swaps stable, NZD softish, & 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 RATE CHANGES
No changes to report today other than the Police Credit Union trimming rates. All rates are here.

TERM DEPOSIT/SAVINGS RATE CHANGES
The Police Credit Union also trimmed TD rates today. All updated term deposit rates less than 1 year are here, for 1-5 years, they are here.

STEPS IN THE RIGHT DIRECTION
The services sector showed improvement in July - but it is still contracting. This improved performance in July is on top of the manufacturing sector returning to expansion in the same month, and indicates the economy may be picking up again from a mid-year slump.

THERE ARE STILL UNREALISTIC VENDORS OUT THERE
The number of properties being withdrawn from the market indicates too many vendors with unrealistic price expectations. House prices are languishing even as interest rates decline, but sales volumes are holding up.

BIG CHANGES COMING
There are some quite large changes coming into force related to building consents. See details here.

TRACKING MEDIAN MULTIPLES
Home loan affordability for first home buyers is improving as first quartile house prices and interest rate reduce. But that isn't showing up (yet) for buyers at median prices. Please note that we have updated our Median Multiple tracking through to July, although it is generally reporting flat results. The best improvements are currently in Gisborne and Lower Hutt. (Our July home loan affordability reports will be released later this week.)

BUSINESSES EXPECT HIGHER INFLATION
The RBNZ's M15 survey of businesses’ expectations for annual CPI inflation increased across most time horizons. Mean one year-ahead annual inflation expectations increased by +9 bps from 2.44% last quarter to 2.53% this quarter. Mean two-year-ahead annual inflation expectations increased by +10 bps from 2.54% to 2.64%. Mean five-year-ahead annual inflation expectations increased from 3.06% to 3.16%. Al are going the wrong way from the RBNZ's point-of-view. More here.

AFFIRMED
Fitch Ratings has affirmed New Zealand's Long-Term Foreign-Currency Issuer Default Rating (IDR) at 'AA+' with a Stable Outlook. They had a list of events that could lead to a downgrade (see link). But only one thing would lead to an upgrade, which would be to AAA - that would be a sharp decline in public and net external debt resulting from substantial fiscal consolidation and a much narrower current account deficit. How likely is that?

NZX50 RISES
As at 3pm, the overall NZX50 index is up +0.4% so far today to start the week. It is now up +0.3% over the past five days and down -0.9% year-to-date. But it is sitting +2.2% higher year-on-year. Market heavyweight F&P Healthcare is up +0.2% so far today. Serko, Vector, Chorus and Infratil lead the gains; Briscoe Group, Tourism Holdings, Vista Group, and Tower are among the bigger decliners

REALIGNING BETTER ON CHINESE OPPORTUNITIES
A2 Milk said it has quit its Mataura Valley Milk (MVM) venture for about $100 mln to Talley's Open Country Dairy - who got it for $130 mln less than A2 Milk had invested there. And A2 Milk is investing heavily in its recently acquired Pokeno facility it bought from Yashili, expecting to expand its workforce by about +100.

REMEDIATION
Aussie banking heavyweight NAB (owner of BNZ) posted a generally positive trading update today, but it also revealed it could have been better because it is having to provide for a revelation that it has underpaid staff in the past on a complex payroll system mistake that will return at least AU$130 mln to those affected.

BIG US JOLT
Singapore’s non-oil domestic exports (NODX) fell -4.6% year-on-year in July, reversing a downwardly revised +12.9% surge in June and establishing a yoyo pattern. This marked the third decline so far this year and the steepest contraction since October 2024, due to a fall in non-electronic exports, especially to the US (-48%) but also China -12%). Perhaps more worrying, near neighbours Thailand, Malaysia and Indonesia all bought significantly less in July.

SWAP RATES STABLE
Wholesale swap rates are will probably be a touch firmer today across all durations. Keep an eye on our chart below which will record the final positions closer to 5pm. The 90 day bank bill rate was up +1 bp at 3.15% on Friday. The Australian 10 year bond yield is unchanged at 4.27%. The China 10 year bond rate is up +3 bps, now at 1.77% which is growing to quite a move up. The NZ Government 10 year bond rate is up +2 bps at 4.47% and up +3 bps at 4.45% in the earlier RBNZ fix today. The UST 10yr yield is down -2 bps from this morning's open, now at 4.31%.

EQUITIES MIXED BUT MOSTLY POSITIVE
The local equity market is now up +0.4% in late Monday trade. The ASX200 is little-changed however in afternoon trade. Tokyo has opened up +0.9%. Hong Kong however is unchanged at its open but Shanghai is up +0.9%. Singapore has opened down -0.7%. Wall Street looks like it will open tomorrow with the S&P500 futures market suggesting a +0.5% gain.

OIL STAYS LOWISH
The oil price in the US is little-changed today, now just over US$62.50/bbl and the international Brent price is now just over US$65.50/bbl.

CARBON PRICE SOFTISH
There have been no trades to start the week so far, but there were more than we noted on Friday after we reported and the price dipped to $56.50. 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 FIRMISH
In early Asian trade, gold is up +US$9 from this time morning's open at US$3343/oz.

NZD HOLDS WITH SLIGHT FIRMING TONE
The Kiwi dollar is up +10 bps from this morning at 59.3 USc. Against the Aussie we are unchanged at 91.1 AUc. Against the euro we are up +10 bps at just on 50.7 euro cents. This all means the TWI-5 is up +10 bps at 67.

BITCOIN EASES BACK AGAIN
The bitcoin price is now at US$115,605 and down -1.5% from this morning's open. Volatility 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 ».