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
Westpac raised most fixed rates today. Details here. All current mortgage rates are here. And note, you can compare mortgage offers with our unique calculator that takes into account other costs and cashback incentives, here.
TERM DEPOSIT/SAVINGS RATE CHANGES
Westpac also raised most of its TD rates for 1 year and longer. All updated term deposit rates less than 1 year are here, for 1-5 years, they are here.
WHAT MBIE'S DATA SHOWS
We have been digging into the nature of student visas. More than 34,000 overseas students are 'dependents of a worker', and they are one of the main drivers of growth in student visa numbers.
BRACING FOR SOLD INFLATION INCREASES
In its survey of businesses released today, businesses of all sizes expect inflation to rise more than one percentage point in the year ahead. These firms had a more realistic starting point than consumers in yesterday's survey, but the expectation trend is the same. Those in the rural sector are expecting the biggest jolt, increasing from 2.57% to 4.01%. And those in the construction sector are also bracing for a chunky rise, from 2.39% to 3.71%.
CAUTION WITH THE CARDS
If inflation is showing up in credit card activity data, it is being masked by very cautious usage. April data shows it falling from March (-1.2%) and from a year ago spending using these cards is only up +1.6%. No-one seems to be splurging on their credit card use. Balances are falling too. Past due balances are not significant, nor are they rising.
AI SKILL DEMAND BOLSTERS JOB AD GROWTH
Hiring demand continues to climb, Seek says, with demand for AI skills growing 'rapidly'. They say national job advertisements are still showing hiring demand, with the number of applications per position declining from the peak levels in 2025.
RECORD TRADE SURPLUS ...
April trade data for goods has delivered a strong result. Exports rose +12% from the year-ago month, or +$943 mln to $8.6 bln for the month. But imports rose only +3.4% on the same basis, to $6.7 bln. That means the April trade surplus was +$1.92 bln, and far above the expected +$980 mln. In fact, April 2026 has delivered an all-time record high trade surplus.
... DRIVEN BY BEEF, GOLD, KIWIFRUIT & ALUMINIUM
Our export increases came from China (+3.9% or +$79 mln), from Australia (+20% or +$201 mln, mostly gold), the USA (up +19% or +$163 mln, mostly beef), the EU (+30% or +$214 mln, half of that horticulture, then aluminium), and Japan (+9.8% or +$47 mln, aluminium the main reason).
LIVESTOCK PRICES RISE
Demand for red meat is rising, and not only from the US. This, and the seasonal need for stock for the processor lines, is pushing up the prices offered to farmers. This week we can see that in higher offer prices for sheep and venison. Since 2024, the seasonal downturn in prices over the summer months is no longer happening. But the rises in the 'off season' still are.
PROTECTING FISH & BEES
The EPA is looking to sharply restrict the use of bifenthrin in agriculture and home-garden applications, a widely pesticide ingredient. They are moving as evidence grows about its significant toxicity risks to fish and aquatic invertebrates, birds, and non-target insects, including bees, when sprayed extensively on crops.. They currently do not plan to restrict its industrial use (like for borer insect control in wood preservation).
NZX50 UP
As at 3pm, the overall NZX50 index is up +0.6% so far today, with a weekly fall of -1.5%. It is down -4.4% from six months ago. From a year ago it is now up only +1.0%. Market heavyweight F&P Healthcare is down -0.4% from yesterday. Mainfreight, Serko, AirNZ, and Vital Healthcare Property lead the NZX50 higher while Turners, Contact, Tourism Holdings, and Kathmandu decline.
PLENTY OF DEMAND, STABLE YIELDS
There were 77 bids worth $1.1 bln today for the $450 mln NZGBs on offer in two maturities. 35 bids won something. The May 2031 bond resulted in a 4.21% yield, higher than the 4.12% for the same bond at the prior equivalent tender two weeks ago. The May 2036 bond gave a 4.71% yield, the same as its last outing one week ago.
MORE GERMAN KAURI
Germany's development agency for agribusiness and farming is back issuing NZD debt securities. Landwirtschaftliche Rentenbank has issued a five year kauri bond for $850 mln, delivering investors a yield of $4.305%.
TAKING MORE RISK, CHASING OUTSIZED RETURNS
For years, Milford has been an investor of client funds into early stage and off-market opportunities, chasing outsized returns. More KiwiSaver fund managers have followed them, and this is now an important source of startup capital for many firms. The latest to broaden their exposure is Generate KiwiSaver though their support of the new Icehouse Ventures Growth Fund investment. As we noted yesterday, average KiwiSaver returns are generally poor and this pushes fund managers into "innovative strategies".
BARRASS TO QUIT FMA ROLE
Samantha Barrass is to step down as the boss of the financial markets conduct regulator, the FMA, when her five-year term concludes at the end of January 2027. She says this is "due to emerging family needs in the UK."
KOREA'S COST CONUNDRUM
In Korea, they are feeling producer price inflation at disarmingly high levels. They rose +2.5 percentage points in April to be 6.9% higher than year ago levels. But factory input costs rose at an average of +11.3% mainly for fuel and other oil-based inputs.
HOLDING HIGH
After a strong rise in February, Japanese machinery orders were expected to ease back in March, and they did, and by about the expected level. However, export orders remained very strong. They are expecting the April-June quarter to just be level-pegging with the same period a year ago. But this whole machinery manufacturing sector is in an upswing phase that started in 2023 and gathered some real impetus from mid-2025.
STRONG EXPORT ACHIEVEMENTS
That factory order data is confirmed in April export data out today. Japan's exports jumped almost +15% to a near-record high of ¥10.5 tln in April, accelerating from an +11.5% gain in March, the fastest pace in three months and topping market forecasts. Exports grew to China (+15.5%), the US (+9.5%), ASEAN (+19.9%), the EU (+26.9%), and India (+8.9%).
EASING OFF
The Australian labour market is weakening with a turn lower in April. The number of employed people fell by -19,000 in April, while the number of unemployed people rose by +33,000. Markets had expected employment to rise by +10,000. Their jobless rate is now 4.5%, the highest in seven months. (The New Zealand jobless rate was 5.3% in March 2026.)
NO LONGER EXPANDING
The April PMIs are out for Australia, and they show weakening business conditions. The S&P Global factory PMI slowed to a stall with the private sector getting its steepest fall in new business in over four-and-a-half years. The service sector is now in contraction after March's stall.
SWAP RATES SOFT WITH YO-YO BACKGROUND
Wholesale swap rates will probably be lower today in its yo-yo pattern. The falls could be steeper today. 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 2.65% on Wednesday. Today, the Australian 10 year bond yield is down -15 bps at 4.95%. The China 10 year bond rate is little-changed at 1.75%. The Japanese 10 year bond is down -2 bps at 2.77% today. The NZ Government 10 year bond rate is now at 4.75%, down -7 bps from yesterday. (The RBNZ data is now 'prior day' with the Wednesday rate up +6 bps at 4.70%.) The UST 10yr yield is down -8 bps at 4.59%.
EQUITIES RISE
The local equity market is up +0.3% in Thursday trade so far. The ASX200 opened its Thursday up a very strong +1.8% in afternoon trade. Tokyo is up even more, up +3.6% at its open. Hong Kong is unchanged and Shanghai is up +0.3% at its open today. Singapore is up +0.3% at its open. Wall Street ended its Wednesday session up +1.1% on the S&P500, up +1.7% on the Nasdaq. Both were before the Nvidia result which was very strong, but after hours its stock fell -1.3% on profit taking.
OIL PRICES FALL
American oil prices are down -US$5, with the WTI benchmark just on US$99/bbl, and the international Brent price is also down -US$5 at US$106/bbl. (Trump has apparently said he is now not going to attack Iran in his latest 24 hour about-face.)
CARBON PRICE HOLDS
There have been very few trades again today on the secondary market, but the price has held up at $54/NZU. See our daily chart tracker of the NZU price for carbon, courtesy of emsTradepoint.
GOLD HIGHER
In early Asian trade, gold is up at US$4532/oz, up +US$70 from this time yesterday. Silver is now just on US$75.50oz and up +US$2.
NZD FIRMER
The Kiwi dollar is up +30 bps from this time yesterday against the USD, now just on 58.5 USc. Against the Aussie we are up +40 bps at 82.4 AUc. Against the euro we are up +20 bps at 50.4 euro cents. This all means the TWI-5 is now just under 62.1 and up +30 bps from yesterday at this time.
BITCOIN UP
The bitcoin price is now at US$77,905 and up +1.7% from this time yesterday. Volatility has been modest at just on +/- 1.0%.
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17 Comments
Today I learned that social housing recipients have won lotto. Damn I so wish I was in social housing.
Talk about robbing Peter to pay Paul.
As so often mentioned on this forum, the accommodation supplement etc needs reform, but this is simply demonizing and punishing a set of people . More homelessness on the way, just what the cities and towns needed.
As so often mentioned on this forum, the accommodation supplement etc needs reform, but this is simply demonizing and punishing a set of people . More homelessness on the way, just what the cities and towns needed.
Yes indeed. Low-income h'holds can't win. They've been necessary for the growth of the Ponzi and now they get a kick in the guts.
The people who are kicked in guts are those who need to get in but can't because of the those who won't move out even though they don't now to be there.
Note Aluminium is included as one of the star exports. Can someone answer a question please. If the smelter owned by Rio Tinto at Tiwai produces aluminium from raw material imported from Rio Tinto in Australia, then the only actual export can be for the portion of the added value of the finished product. Is that it?
Agreed - and it has been that way since Hugh Watt opined that the deal was his crowning achievement.
Value-added for o'seas owners, courtesy of all grid-connected others.
About to be replicated via datacentres.
Oh well, at least he wasn’t knighted for the effort. Mind you, if he had been one of the Nats, likely he would have been.
We could all create a bit of personal surplus, and buy shares in Rio Tinto. Then what is the problem.
Over the ditch, the Ponzi hits a speed bump. Westpac has told mortgage brokers it will not honour pre-approved investor loans for customers, which would need to be reassessed after banning negative gearing.
https://grafa.com/en/news/australia/westpac-triggers-investor-loan-revi…
Kaaaaaarkkkk
re Caution with Credit Cards
Caution needs to be taken in assuming that credit card use is solely down is a reflection of reduced spending (although this may be a factor.)
I know my use of credit card spending is probably down by 50% although my spending is not constrained. It’s simply that I loathe those surcharges - not that I can’t afford it but on principle I’m not keen on donating money to the banks and cc companies. Bottom line, I use my card but take the cheque option if there is a surcharge.
That 1.5% surcharge for a month when due for payment, annualised is well over 20%. Thieves.
But there again I’m a tight p**ck - in 40 years using a cc I have paid the balance every month without fail so have never paid interest on any outstanding balance while enjoying the convenience, and the rewards which far outweigh the annual charge. Call me a bludger if you want - but not a stupid old b*stard.
Yep just hook up an auto payment to pay the balance on the due date and you get the perks for free. I only use it when there isn’t a surcharge, but most of the bigger expenses are surcharge free, such as supermarket and petrol. I can spend my true rewards at pak n save, it’s basically just free money.
Problem with that logic is that you use your credit card more than say cash or eftpos so those “benefits” are a false economy. Many studies have shown human behaviour means you spend more of your future income when using credit
Credit cards aren't what they used to be in terms of benefits. Pre airpoints dollars the likes of AmEx was ideal if spendings were high enough and you threw everything on it to make the cost/benefit worth it. The ratio is more skewed now with greater fees and lower benefits to justify the need for CC's IMO.
Suckers.
May 20 (Reuters) - Devon Energy accounted for more than half of a record $4 billion sale of oil and gas drilling rights on federal lands, according to the U.S. Bureau of Land Management.
The sale's total obliterated that of all previous onshore government oil and gas auctions at a time when the Iran war has cut global supplies and raised demand for U.S. crude oil.
https://www.reuters.com/legal/litigation/us-oil-gas-auction-new-mexico-…
Holly Crashing Ponzi Batman!
https://www.stuff.co.nz/home-property/360981871/stupid-people-who-bough…
Not Waiheke not the Auckland Hamptons
I cannot wait to discuss this on the normal Interest Saturday Auction result page with Hamish and Yvil and other roadkill spruikers,
talking some prime real estate at palm beach
New data shows Chinese household debt experienced its steepest monthly decline on record in April. This shift toward "defensive" financial behavior among citizens—prioritizing debt reduction over borrowing—is occurring alongside aggressive debt-fueled stimulus measures from the Chinese state, highlighting a major divergence in the country's economic health.
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