Here are the key things you need to know before you leave work today.
MORTGAGE RATE CHANGES
Both TSB and Bank of China raised fixed rates today. Some other institutions are planning to raise fixed rates on Monday.
TERM DEPOSIT RATE CHANGES
None today. But we know that there will be some good rises coming early next week
CONSUMER CONFIDENCE HOLDS, INFLATION EXPECTATIONS EASE
Consumer confidence eased 1 point to 97 in November. Within that, perceptions of current conditions rose but expectations fell sharply. The proportion of people who believe it is a good time to buy a major household item lifted 1 point and remains subdued at -6. Inflation expectations eased half a percent to 5.7%. House price inflation expectations fell back under 6%.
GOOD INVESTMENT
Total KiwiSaver assets topped $90 bln at the end of September, according to new RBNZ data out today. (T43) These balances have grown +24% in just one year, or +$17.6 bln. Some of that is contributions of course (+$7.2 bln), but investment gains are making up a larger portion now. It could only be two quarters for this valuation to exceed $100 bln (unless the share market tanks of course).
SBS HALF-YEAR PROFIT UP +35%
The SBS Group, including SBS Bank and subsidiaries Finance Now, FANZ and SBS Insurance, posted September half-year operating profit of $32.5 million, up 35% or $8.5 million. Lending rose $93 million to $4.13 billion. SBS also disclosed a $100 million drawdown on the Reserve Bank's Funding for Lending Programme.
BANK METRICS DEEP DIVE
The RBNZ released its Bank Financial Strength Dashboard today for the September quarter. That data powers our Key Bank Metrics tool which is now updated too.
RESURGENT
In Australia, retail sales jumped +4.9% in October as opening up generated a strong surge. But as ANZ economists have noted, their recovery is now "a supply side issue".
IT'S ALL ON AGAIN
The news of the new COVID virus in South Africa that may defeat the vaccines and spread more virulently is weighing heavily on markets today with broad selloffs. Countries are starting to close borders again to protect themselves from rapid spread.
LOCAL PANDEMIC UPDATE
In Australia, Delta cases in Victoria have risen again to 1362 cases reported there today, its highest in November. There are now 10,887 active cases in the state - and there were another 7 deaths yesterday. In NSW there were another 261 new community cases reported today, and a rise, with 2359 active locally acquired cases, and they had one death yesterday. Queensland is reporting zero new cases yet again. The ACT has 8 new cases again. Overall in Australia, just under 86% of eligible Aussies are fully vaccinated, plus a bit over 6% have now had one shot so far. In contrast, there were four cases in New Zealand at the border, and 173 new community cases today. Now 91.9% of Kiwis nationally aged 12+ have had at least one vaccination, and the Australian rate is now at 92.0% of all aged 16+.
GOLD HOLDS
In early Asian trading, gold is at US$1793 and little-changed from this time yesterday. It closed in New York and London earlier at US$1788.
EQUITIES SINK
Wall Street was closed today for their Thanksgiving holiday. However, Tokyo is down a very sharp -1.9% in early trade today, heading for a weekly loss of -2.4%. Hong Kong is down -1.6% in early trade today, heading for a weekly loss of -2.8%. Shanghai is down -0.5% in its early trade and if it finished like that would have a +0.2% weekly gain. The ASX200 is down -1.3% and heading for a -1.2% weekly retreat. The NZX50 is down nearly -1.1% in late trade and heading for a weekly loss of -0.6%.
SWAP & BONDS RATES DROOP
We don't have today's closing swap rates yet. They are probably sharply lower in a bear steepening. The 90 day bank bill rate is unchanged at 0.80%. The Australian Govt ten year benchmark rate is now at 1.80% and down -8 bps from this time yesterday. The China Govt 10yr is at 2.89% and down -2 bps. The New Zealand Govt 10 year rate is now at 2.47% and down -6 bps, but well below the earlier RBNZ fix for that 10yr rate at 2.58% (+1 bp set before the virus news). The US Govt ten year is falling on the new-variant virus news, down -5 bps to 1.59% compared to this time yesterday.
NZ DOLLAR SOFTER
The Kiwi dollar is now down at 68.4 USc and a -½c retreat from where we were this time yesterday. This time last week it was 70.4 USc. Against the Aussie we are down slightly at 95.4 AUc. Against the euro we are down more than -½c at 60.9 euro cents. The TWI-5 is now up at just on 73.3 and down -50 bps. For the week it has fallen from 74.8, a -150 bps devaluation.
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BITCOIN FIRMER
The bitcoin price is now at US$58,829 and up a modest +1.5% from this time yesterday. Volatility in the past 24 hours has been moderate at just under +/-2.1%.
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73 Comments
"perceptions of current conditions rose but expectations fell sharply"
Perhaps a good time to keep an eye on businesses shuttering as we head into the holiday season? No point paying staff holiday leave etc if the doors aren't going to open again after Christmas. 4 weeks notice now should tick all the regulatory boxes.
Dunno, he could be an effective placeholder if that's all he goes into it pitching for. Reti/Willis or Reti/Stanford seems to be the most appealing combo for the centre but I'm not convinced Reti actually wants it and values his time away from politics and being able to keep practicing medicine too much.
Irony being is that's probably exactly why it should be him. He might need time to come around.
Chris Trotter did a piece about this
https://thedailyblog.co.nz/2019/11/08/chosen-to-rule-what-sort-of-christian-is-chris-luxon/
If the media sniff some "odd beliefs" he'll be a target....
There'll be plenty who won't like this sort of thing. ..
How many houses? Luxon didn't build a company. He took one that was built by taxpayer funds over decades and maximised profits. He also took the joy out of working at Air NZ according to many employees I've spoken to. An approach to running the country one part Calvinist certainty, one part hard-core neoliberal and one part evangelical 'magical' thinking = disaster for NZ.
The last thing we need is another round of Rogernomics/Ruthanasia, or parliament being used as a pulpit. Either prospect makes me shudder.
Yes, I'm sure as soon as he's elected, he would ban homosexuality and introduce the death penalty by Village stoning.
Meanwhile, in socialist utopia. The govt has made the housing crises a complete disaster, the rbnz has buggered up the pandemic QE response, and we are still locked in country due to crumbling health infrastructure.
Leave his personal religious views out of it. We have bigger problems right now than worrying about optimal diversity optics.
Making a point of someone's race, gender, skin, colour, age is discrimination.
If I said we need a strong white male leader, you'd have a spasim of indignation.
Someone is either compotent, or not. And the current govt swings from failure to failure.
Nice diversity visuals will not get us out of the global mess we are in. Global warming doesn't care if your a pasty white male, or a fat Liberal with a face tattoo.
I think Dr Reti has a rare touch of dignity about him and is respected a lot more than most mps, all sides of the house. that speaks for itself but not sure if he is equipped to handle the gutter sniping and other antics that a leaders have to deal with. But it would be a new image as a leader carrying both credibility & sincerity, his qualifications & work experience for a start, and with Luxon as deputy on the financials, could be a effective team.
Some aspects true but Muller seemed to be stuck in a mindset of firstly being in Bolger’s period & secondly a wistful yearning for the halcyon time of Key’s first two terms. Dr Reti offers much more than that in terms of substance, empathy and education and life experience. It is something of a sad commentary that those abilities are considered insufficient to succeed in government. Reminds me, as a irrelevant comparison, that Conrad Smith was dismissed early on as an All Black prospect, because he was considered to be too small.
Like Angela Merkel. You would prefer Boris? Helen Clark was highly professional but there were few Kiwis who would have invited her to a social event for her relatable personality; she was rather like an old fashioned school principal.
It must be me - I preferred Andrew Little to his successor.
NZD still getting hammered rates might need to go up to protect NZD we are loosing purchase power. Inflation will continue raise if nothing is done especially with imports going up
NZDUSD at 12-month lows but still well up from March 2020. Good chance that a global shock will see it sink like a stone if the interest rate differential is not attractive enough.
https://twitter.com/wmiddelkoop/status/1463970626004213766?s=20
Chart of the new Covid version spread rate compared to other variants. Its bad.
More variants !!!! Lol
I've been saying for months... there is no freedom coming... rather expect stories of variants, more boosters, and more lockdowns...
Why?
Cos the world economy would reveal itself as bust if we let spending power hit the street... inflation would skyrocket ...
The sheep are being herded....
Just one more booster, and we'll be back to normal right...
Cos the vaccine doesn't work on this one!! Honestly, sheep will believe anything if someone puts a lab coat on...
He's right Frazz. Not only do they not work properly, scientists were screaming from the rooftops that they'd lead to vaccine enhanced disease. Look here, here, here, and here and that's just a few papers. Then we saw the evidence in genebank that the directed evolution of spike was happening just as predicted here. Then we saw the predictable result here, highly mutated spike variants that escape the vaccine, just recently. Fortunately that one A.30 seems to have fizzled out but it'll be back, and that's the trajectory we're on. That's what happens when you put all your eggs in one crappy basket.
No it’s what happens when you have inequities in a vaccine rollout where only 6% of Africa have been fully vaccinated. It’s not a coincidence that these new variants are generated in Africa where transmission has been allowed to flourish via lack of vaccination and high HIV rates. Stop “referencing” non-peer reviewed publications, it’s pathetic.
I said months ago there was the possibility of this happening. Labour just wasted 2 years and we will be back to square one if this turns bad. 2 years for better hospitals and a dedicated MIQ facility. This country is toast if we have to go into level 4 lockdowns for months.
How the RBNZ have passed $6 bio to the sheeple through the Long-term Asset Purchase Scheme (LAPS). That amount will only grow.
I like these select comments:
It is easy to squander taxpayers’ money if you are a central bank. The losses amount to a few thousand dollars per household, but hardly anyone is aware of it.
The losses for taxpayers look set to rise by many more billions. Rising inflation expectations depress bond prices, lifting interest yields. Taxpayers are enduringly exposed because the RBNZ has badly mismatched its assets and liabilities.
Under the indemnity, the RBNZ can shrug its shoulders and keep its massive gamble open. But someone should be accountable. Surely it is Treasury and the Minister of Finance.
https://www.nzinitiative.org.nz/reports-and-media/opinion/new-opinion-1…
Michael Reddell (ex- RBNZ economist) had this to say in recent weeks:
Thanks. I made a disparaging remark about Robbo y'day and got away with it. I just noticed what Reddell wrote.
(Where does the Minister himself fit into all this? I’m not particularly sympathetic to Robertson, who seems the epitome of a minister uninterested in holding anyone to account, but realistically on the dawn of a crisis, no Minister of Finance was likely to have turned down the Bank’s request for an indemnity, at least if The Treasury was onside with the Bank. No, the substantive blame here rests first and foremost with the Governor, the MPC, secondarily with the Bank’s Board and the Secretary to the Treasury, and only then with the Minister of Finance. But it is the Minister who is accountable to Parliament and the public, and who had failed to ensure that the Reserve Bank was fit for purpose (people, preparedness) going into a crisis like Covid.)
Interesting read. Took me a coffee and a couple of Google searches to get through it..
Serious question. Do orr Robinson actually talk to each other? Like every week? Daily? Or do they just trade steering committee reports?
I'd assumed that the whole response was carefully orchestrated.
The best question I’ve heard about yesterday’s MPS was from a first year economics student, who wanted to know how the Bank could claim to be fulfilling its mandate.....
Is Orr the best we've got??
All in all, it was a fairly typically poor Reserve Bank performance, perhaps undershooting even my low expectations. It was good that some questions were asked – at the press conference and at FEC – about the high turnover at the top of the Bank, even if Orr was allowed to get away much too easily with ludicrous claims about what a desirable place the Bank was to work, what an abundance of talent they had available etc etc. It certainly wasn’t on display in this document.
(On the turnover question, one almost had to feel sorry for the Chief Economist who has been restructured out: asked by MPs about what was going on Orr rashly talked about how Yuong Ha “has chosen to go into a far more challenging role. What are you going to be doing?” There was a noticeable, whereupon Ha lamely responded “Coaching my son’s cricket team. Taking a break”. Orr seemed to display all the sensitivity and personnel management skill of, say, a Judith Collins.)
Since when did a person's vax status become public ,"news"???
This constant public "shaming" would normally be alarming to people... yet the public wants blood...
https://i.stuff.co.nz/national/health/coronavirus/300461453/covid19-han…
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