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
Unity Money and Wairarapa Building Society (WBS) both raised some fixed rates today. 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
WBS raised some term deposit rates too. All updated term deposit rates less than 1 year are here, for 1-5 years, they are here.
APRIL HOME LOAN AFFORDABILITY SLIGHTLY EASIER FOR FHBs DESPITE RISE IN MORTGAGE RATES
Getting into a home of their own became slightly easier for first home buyers in April, as falling house prices outpaced increases in mortgage interest rates, according the latest Home Loan Affordability report. Mortgage rates continued to increase in April, with the average of the two-year fixed rates offered by the major banks rising to 5.18% in April from 5.05% in March. However, the effect of that on mortgage payments was more than negated by a drop in house prices.
TOP-UP ACTIVITY, & BANK SWITCHING STAND OUT IN APRIL
New data for April from the RBNZ (C33) shows two interesting trends. First, there seem sto be a renewed interest in mortgage top-ups with $1 bln lend on this basis in April, almost 20% more than in April a year ago. That makes it two months in a row where top-up lending exceeded $1 bln, and the fourth month in the past seven of $1 bln+ top-up lending. The other point to watch is that borrowers switching banks are doing so with smaller loan balances. To the end of 2025 the average switched loan was over $720,000. In April this average has fallen to $650,000 - so many more borrowers with smaller loan balances are seeking to switch banks, presumably for sharper rates and lower payments (or to capture cash-back benefits). We will get some insight on which banks have been the wiiners, and who have been the losers, when the RBNZ Dashboard data is released late Friday
MARKETS FAR LESS CERTAIN
Two weeks ago (May 13), markets priced in a 50% chance that the OCR would be raised by +25 bps on Wednesday, May 27. At that time they had more than that +25 bps fully priced for July 8, and another +25 bps for September 2. Things have change since. Today they have virtually no chance of a rate rise priced in (just +4 of +25 bps). And they now don't have it fully priced for July 8 (+17 of +25), shifting the chances back to September 2 and October 28 where each is now priced for +25 bps. As for tomorrow, Westpac notes an on-hold decision is universally expected by markets and economists tomorrow. The market reaction will largely hinge on the OCR track shift and commentary tone, with much attention on the impact of the Iran war.
NZX50 LITTLE-CHANGED
As at 3pm, the overall NZX50 index is up +0.2% so far today, with a weekly rise of +0.2%. It is down -4.1% from six months ago. From a year ago it is now up +3.7%. Market heavyweight F&P Healthcare is now up +7.1% from yesterday. In addition to them, Gentrack, Air NZ, and Heartland drove the market higher amid their report releases, Infratil, Mainfreight, Freightways, and Port of Tauranga declined.
WHERE ARE THE ANGRY CROWDS & PITCHFORKS?
Some readers will know this daily summary has been critical of KiwiSaver returns (based on Sorted's analysis). One reason might be the allocation to Spark (SPK) in equity investments. Not that long ago it was well inside the top ten of NZX50 companies. Now it is unlucky #13. At the start of 2024 it had a capitalisation value of $10 bln. Now it is just $3.7 bln. That is a loss of value of -$6.3 bln. Over the same period profits have fallen. Their share price has too, only kept alive by a high dividend payout. It can't last. Where is the accountability of the board/management? Losing $6 bln should have crisis consequence. It's a loss equivalent to what the Government spends on Defence in a year, or what is spends on Jobseeker+Supported Living benefits. It is a huge amount. Vanished. (H/T BJ)
NO REAL RECOVERY YET
Ryman Healthcare (RYM) reported its Match 2026 annual result today, posting a +12.5% rise in revenues but a loss, even if it was much smaller than last year (-$171.3 mln, vs -$513.7 mln). Their share price has already been marked down -26% so far this year, and it dipped another -0.4% today. That is a capitalisation loss of -$1.15 bln in just five+ months.
WAITING FOR THE NEW PORTFOLIO TO PAY OFF
The Morrison investment vehicle Infratil (IFT) has posted flat results for its year ended March 2026. Their key top-line metric is EBIT which was up +11%, but NPATx was little-changed. More than 60% of their investments are now in the CDC data center business and One.NZ. Investors have been profit-taking today after the pre-announcement run up in the share price. Today it is down -6.5%, enough to drop them from #2 on the NZX50 to #3 by capitalisation.
FPH PROVES DOUBTERS WRONG - AGAIN
Fisher & Paykel Healthcare (FPH) reported strong results today for their full year to March 2026. Revenues rose +14% from the prior year, NPATx rose +24%. Usually, good results trigger profit taking, but FPH shares had been marked down earlier, and the positive outlook (+12%) has triggered a share price surge. (+7.1%). Their capitalisation has fallen -$990 mln so far this year, even with today's jump.
'PEACE' SEEMS A LONG WAY OFF
In the Middle East, US and Israeli struck a number of Iranian vessels in the Strait of Hormuz, hours after President Donald Trump had suggested negotiations with Tehran over an interim deal were progressing. Renewed aggression there and in Lebanon hardly seems to indicate talks are "going nicely". Both sides are in a chronic violent embrace, despite what they say.
SWAP RATES SOFTER
Wholesale swap rates will probably show another dip in a global flattening trend, still all about the 'peace deal' hopes. 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 2.62% on Monday. Today, the Australian 10 year bond yield is up +4 bps at 4.92%. The China 10 year bond rate is little-changed at 1.75%. The Japanese 10 year bond is unchanged at 2.71% today. The NZ Government 10 year bond rate is now at 4.64%, down -3 bps from this time yesterday. (The RBNZ data is now 'prior day' with the Monday rate down -4 bps at 4.64%.) The UST 10yr yield is up +2 bps at 4.51%.
EQUITIES MIXED
The local equity market has picked up in the past hour so is now up +0.5% from yesterday. The ASX200 is down -0.4% in afternoon trade. Tokyo is also down -0.4% at its open. Hong Kong is up +0.4% but Shanghai is down -0.9% at its open today. Singapore is down -0.9% at its open. Remember, Wall Street is on holiday (Memorial Day Weekend) but will re-open tomorrow.
OIL PRICES HOLD/EASE
American oil prices are unchanged with the WTI benchmark still just on US$91.50/bbl, and the international Brent price is down -US$1 at US$97.50/bbl. These shifts are before markets react to the latest hot flare-up.
CARBON PRICE HOLDS
There have been very few trades today on the secondary market, and the price has held at $53/NZU. See our daily chart tracker of the NZU price for carbon, courtesy of emsTradepoint.
GOLD EASES
In early Asian trade, gold is down at US$4534/oz, down -US$36 from this time yesterday. Silver is now just on US$77oz and down -50 USc.
NZD LOWER
The Kiwi dollar is down -20 bps from this time yesterday open against the USD, now just on 58.5 USc. Against the Aussie we are down -30 bps at 81.7 AUc. Against the euro we are down -20 bps at 50.3 euro cents. This all means the TWI-5 is now just over 62 and down -20 bps from this morning.
BITCOIN MARGINALLY SOFTER
The bitcoin price is now at US$76,556 and down -0.6% from this morning. Volatility has been low at just over +/- 0.9%.
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50 Comments
Some readers will know this daily summary has been critical of KiwiSaver returns (based on Sorted's analysis). One reason might be the allocation to Spark (SPK) in equity investments.
Smart NZ Dividend ETF also has direct exposure to Spark - around 9-10% of the fund. Share price down 56% over past 5 years.
https://divvydiary.com/en/smart-nz-dividend-etf-NZDIVE0001S8
Telecom / Spark customers are dying and/or finding cheaper deals elsewhere. It was always going to happen eventually, it just took a very long time.
'It is a huge amount. Vanished.'
You ain't seen nothing yet.
A few indicator fish, a Ponzi doth not assuage.
Been a bit of a Greek Tragedy hasn’t it. The Lange/Douglas lot set the privatisation in motion & Bolger & Co signed it off. When listed the share price took off as if it strapped to a rocket. Probably in it’s time the most sought after blue chip, cornerstone investment for every mum and dad and more. And then came the Clark/Cullen intervention, gleefully imposed by Cunliffe, that crashed dived the share price and whipped $ millions off all those mums and dads budgets and more, and its really been on a long trajectory downwards ever since. A question remains as to the basis, structure and purpose of the privatisation as formulated by the 4th Labour government that then required the 5th Labour government to dismantle it.
Likewise the left sabotaging the 49% sale of gentailers. Much lower IPO buy in for investors, less revenue for govt.
Magic then?
Where did the wealth come from again?
Hint - when there's only Peter and Paul in the arena..
I would still look for Mary!
And the flowers - they're all gone too
long time passing
Writer's sister was in the Sounds, last I heard.
Makes sense, written in 1955.
I have starlink and one nz, have not used spark for a long long time.
Albo states he doesn’t think property investment is “productive”, despite building his property portfolio using negative gearing for decades. Not good considering Team Albo wants people to invest in "productive stuff".
And this is dreadful:
The second was their attempt to force the corporate cop ASIC to change regulatory disclosures to advantage super funds buying houses.
Jim Chalmers received correspondence from super fund CBus in his first year as Treasurer. CBus complained they had to comply with the ASIC regulatory guide 97, which says they must disclose stamp duty costs to members. Shock horror: Cbus wanted to cover this up.
At the post-election Economic Reform Roundtable, Chalmers made this a centrepiece of his agenda. He strong-armed ASIC into consulting on making this change for his mates at Cbus, but was rebuffed by the corporate cop.
Now its an election issue its do as I say not as I have done.
Morgan Stanley calling a 10-20% fall in prices (to not panic the women and horses) will be AKL / WGTN levels 30% before any stabilization. Going to be ugly.
Why has the 50% expectation of a 0.25% OCR rate rise on 27th of May almost fully vanished ?
I for one can't read the mind of the market, but I can read my own mind, and perhaps the market is aligning with what I have been saying for a couple of weeks - which is that there might only be one hike this year, and not for a while.
I'm not sure why this should be surprising, nor why bank economists don't hold this view.
The RBNZ's outlook should be medium term, it's likely that this inflation shock is a very short term one.
It's quite likely the CPI will be back to 2-3% range by early 2027, yet prices for many things will still be significantly higher than they were in 2025. The economic pain of this price shock will linger, which is why I see the OCR being cut a couple of times by the end of 2027.
I really appreciate you comments on this issue. I think many have underestimated the economic and emotional impact of the fuel spike on NZ. Corporates had hope and now its gone, cuts are next.
Corporates are doing redundancy rounds already. There will be no H2 recovery at all, and its likely if international events flow across us that 2027 will be much worse the 26. There is a risk IMHO that the OCR will need to be lowered and that this could easily happen this year. The middle east has no predictable outcome, markets are pivoting on every minute announcement. Even a deal could be broken the next week. Meanwhile the domestic economic situation in both the US and China look very fragile.
Watch the US30Y no one can deny its impact on equities.... a equities crash here is both likely and will be devastating on consumer sentiment. AI is real but the economics are a bubble.
Imagine if the left win election 26....
100%.
Spoke to an acquaintance the other day, his consulting firm has grown and grown last few years. I told him it was great to see the growth in his company (I peeked at the 'Team' part of his company's website, probably double the numbers of staff compared to 3 years ago)
He said 'yeah, nah' - things have got really slow now, will do round 1 of redundancies soon, at least 20% of staff to go
Something else people never seem to talk about is 'Bonus destruction'. In a strong economy, good and widespread bonuses must really have some sort of economic stimulatory effect.
You can forget green shoots, Corp NZ is going to wait until they see lush green meadow before investing.
Nothing before Nov election result and even then, it will be show me the money
Another point - people often conflate sustained high prices with inflation. Different things.
Example, using a scenario with Unleaded 91:
January 26 price: $2.30
April 26 price: $3.40
Sept 26 price: $3.10
Jan 27 price $2.90
April 27 price: $2.80
In this scenario, the price in April 27 is significantly higher than it was in Jan 26. But by April 27, we see deflation when measured on a 12 month basis
"It's quite likely the CPI will be back to 2-3% range by early 2027"
I doubt this. Yes, oil prices may well be back to around $70/barrel, but everything that is made from petroleum products will take time to show up in inflation figures. Probable higher food prices due to the reduced fertiliser amounts will take even longer to show up. I think inflation will stay elevated for some time. I agree that in NZ and in many other countries there is economic pain, I think stagflation is coming and that we are in a terrible place, stuck between a rock and a hard place.
Agree.
Have been predicting this - but of course not the exact pathway - for over 20 years. It was inevitable.
With ramifications for all 'investments'.
Essentially, western civ. can no longer afford itself.
Good points.
Yet, fuel is a key element of the CPI basket, and by April 2027 could be -10% to -20% price falls on a 12 month basis. Maybe. War-outcome dependent.
And rent - can't see that rising much if at all. Also hard to see much inflation in discretionary prices. Business suicide.
Fair point on food.
Rates. Auckland is +7.9%! So, yeah
There's a range of plausible scenarios. I would maintain that a low-ish inflation outcome is one of them.
Food prices will show towards xmas. Maybe it will be the stonefruit given harvest time, but depends on the stockpile of fert around the country from orchardists, and also for spring crops. Crops that can winter like broccoli and cauliflower may be ok but we'll see. If not, it should be clear by Feb '27 for harvest time for many crops.
Plastics are an interesting one and I watch with interest on if the supermarket will see a drop in available product options, or stock running out more often due to packaging shortages. I don't expect any large shift in packaging as manufacturers will be banking on a resolution to any plastic shortages over time as it is too cheap to seek alternatives this early.
It’s hard to know what will happen. It will be difficult for RBNZ not to hike when stats announces a massive CPI, but stats are so late that fuel may have dropped down by then and they can say it is temporary.
At the moment it doesn’t feel like we will get any more OCR rises this year than the market had already priced in before all this occurred. Maybe even less.
In the Middle East, US and Israeli struck a number of Iranian vessels in the Strait of Hormuz, hours after President Donald Trump had suggested negotiations with Tehran over an interim deal were progressing.
So the US bombs Iran during a negotiation, again, and calls it "self-defence". What a ridiculous load of caque.
Question, does being bombed for the 3rd time during a negotiation, help Iran trust the USA, or does it hinder the negotiation process ? Anyone ?
Iran will never trust the USA and, given their long history, are unlikely to much trust anybody for that matter.
Both the most recent war initiatives, were by the US, during 'negotiations'.
And they remember the why of Mosaddeq
The average citizen probably envies our 'decadent' lifestyles (and like most of us, have no idea they're very temporary) but distrusts the US infidel more.
With reason. Indeed, with increasing reason.
Well as I mentioned the other day, as history would have it the Iranians have every reason to be looking over their shoulder. In the 13th century Genghis Khan swept right through Persia and then later his grandson took it much further. It was during that second passage the West, Edward 1 & Louis 1X allied themselves with the Mongols in a concerted attempt to eradicate the Muslim following. So there it is, assailed from the East and assailed from the West. Wonder of the internet, that bit of history unknown to me until digging around one thing leads to another.
Central Command spokesperson Capt Tim Hawkins said the US military "continues to defend our forces while using restraint during the ongoing ceasefire"
Since when did a casefire involve attacking the other side? The world has gone mad, how can the news media report these statements without pointing out the blatent lies? Scared of being called 'fake media' by the liars, the news tellers have been taken over by newspeak.
The Iranians will be testing and probing US air superiority in the strait. Send out a few fast attack craft and see what happens. Lock a radar on US assets. That sort of thing. They probably got some valuable data.
It’s a war zone. Stuff happens. Yet here in all likelihood the USA’s deep dread, of the consequences back home should there be major damage to an asset and/or numbered casualties, would when in doubt, precipitate a fire first think later policy.
I have to admit I had to "AI" Han Feizi.
Uber’s COO has said that it’s getting “harder to justify” its AI costs because there was no way to show a link between AI spend and any meaningful increase in useful features.
Not many companies saying this directly.
Macdonald added that AI can seem free if you're "just a user sitting there coming up with interesting use cases" without paying for it. But ultimately, the company foots the bill.
https://www.businessinsider.com/uber-coo-andrew-macdonald-ai-token-spen…
Expect a lot of Claude 4.6/7 users cut back to Copilot CLI shortly.
I suggest many will never get to see what Claude can do in the slower movers, that is most NZ Corps, I feel lucky to have been in a space that wanted to see what AI could do when it was essentially free.
I feel lucky to be able to use my brain.
Logic, systems, critical thinking...
Wouldn't go near a laziness-inducing monopoly-owned programme if you paid me. Still do mental math in the workshop, longhand if complex, a calculator only to cross-check.
Use it or lose it...
Bravo!
Power, I agree, the danger of brain atrophy is real ...
I remember my nan, born 1918, who could do mental arithmetic upside down on dockets faster than the poor shopgirl opposite who was laboriously toting up the items, this was the 1970s; she never 'rose higher' than a housemaid and a housewife, but her brain worked fine, until dementia, and then she just smiled and hummed, mostly ...
I value my ability to do similar mental arithmetic and deduce that a proposition is out by orders of magnitude, while my staff are still trying to log in to their iPhones to start the calculator app and answer the question to which I already know the answer.
But ...
I'm also with ITguy ...
because I can do things for myself with AI for $40 per month (I know it's just digits) that previously required $000s of dollars of experts and specialists and advisors - in whom I had to hope and trust - now I know, I've wrangled the possibilities, I've learned about areas way outside my comfort zone.
There's a level at which AI has made me more independent, it's challenging my thinking, expanding my horizons,
it's also bloody frustrating, requires constant challenge and correction, are you sure about that?, what might a more critical examination of the evidence show? don't just regurgitate for me the marketing bumph ...
You might be astonished, PDK ... if you deigned to give it a try.
You can always learn things outside your comfort zone on your own - I knew nothing about economics (I'm all engineering/physics/levers/logic) but realised it had to be 'wrong', back around 2006-7-8. So I went to school (well, to books - I added to an already-extensive library) and learned enough to challenge what is an obvious crock (betting on growth-forever - who could be so stupid?).
As to using it, I've got to know/reason/understand things - not to accept that some programme has done that for me. What is it to be human, if you've given that joy away? And I've played with algorithms enough to know they give you what you want to hear (I played YouTube re Iran, recently; they give you the rabbit-hole they think you want; you can play it like a violin).
But the biggest problem is that my thinking has paralleled this fellow (no slug note) Energy and Human Ambitions on a Finite Planet it's a free download; do yourself a favour and bother. He - and a growing cohort of us - have realised that we couldn't 'save' modernity (he and I were both early-adopters of PV (both offgrid 20+ years, thought we should lead the way) that indeed it is temporary.
I've downloaded and read that Tom Murphy book five years ago, and done many of the calcs, to confirm for myself. Transformative.
It may even have been you who first mentioned it (:-)
And I guess what I'm saying is that AI is another tool for learning: a printing press, a library, an encyclopaedia, an internet, a naive, willing, hugely knowledgeable, expert on so many things ...
This "As to using it, I've got to know/reason/understand things - not to accept that some programme has done that for me. What is it to be human, if you've given that joy away?" is to demonstrate that you haven't used it ...
Your dissing of AI, in ignorance of it, using paradigms that are outdated ...
A bit like most on this site diss what you say about energy, about resilience, about entropy ...
onya
Did it change your goals? I've spent a lifetime valuing energy (and efficiencies, usually physical but sometimes social) rather than money. It forces lateral thinking; interestingly towards the end of life it is interesting to compare peers who chased the gold. I don't envy any - indeed feel sorry for some.
But nowadays, the yardstick is to make the landing as soft as possible for my grandchildren. That doesn't need AI
:)
Changed my goals? Yes.
:)
I haven't seen any evidence of you learning anything recently PDK. You seem stuck in 1950. Who are these economists that claim that you can have growth forever?
To see evidence, one has to have one's eyes open.
And have a connection behind the retina.
And I was taught by my old man, to 'turn things inside out, upside down and back to front' when I was 9ish. So I'll ask: How many economists are positing that modernity is temporary, and that we are at or near the inflection?
Not a helluva lot, you'd agree?
How about we guesstimate the year their main cohort stopped thinking? (I excuse Malthus, Mill, Jevons, Soddy, Galbraith, Boulding, Georgescu-Roegen, Daly, Keen and a few others who could actually think).
How about 1776?
So, in other words, you can't name a single economist that claims things can grow forever.
No reputable economists claim that modernity is temporary on any meaningful human timescale. To reach that conclusion they would have to show there would be no further energy substitutions, technological changes or efficiency gains, that these things would stop all at once. A most unlikely scenario and one that contradicts every empirical trend we have.
I love math, which seems to be against the social norm these days. Mental challenges are just as fun and beneficial to train the mind as physical is to the body.
It isn't my forte, but I use it as a tool to get where I want - which is usually a pushing of efficiencies, which usually means tracing and parrying entropy. What amazes me is the way so many people just don't think. At all.
As someone - I think it was Daniel Quinn - said: maybe we aren't as sapient as we think... (lovely nuance).
IT GUY what do you think of the cheaper Chinese versions?
Are they the Great Walls and BYDs of the next few years?
I have not played much, my Corp would never allow due to potential data loss.
I did download the lowest Deep Seek size model and ran it locally (at home) , I was impressed and disappointed, mind you I would never use such a small model professionally. The dynamics mean IMHO that human level AI will probably be almost free in 10 years time, but the best models then will still cost $.
This is the biggest change I will ever see in my lifetime, to access unlimited human average intelligence for $500 a month seems nuts, I suggest the Indian IT outsource models are dead here, good bye TCS, its been ... ok knowing you.
Once AI is at your own personal level of intelligence - for minimal cost, what more do you need to know, what more can you offer?
At the moment , due to training, AI offers the average of the internet, if it really starts to think for itself I suggest no one can forecast what comes next. I am worried about AI and drone use on the battle field.
I can imagine a cargo ship of drones, each drone programmed with the identity of a citizen, and their digital footprint. Could wipe out a population pretty quick. Nowhere to hide. We're probably pretty close to that now.
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