A review of things you need to know before you go home on Monday; Kiwibank nips and tucks TD rates, more 'wellbeing' from Housing NZ, Westpac NZ CEO in the money, local swaps are taking off again, dollar rises in sympathy

A review of things you need to know before you go home on Monday; Kiwibank nips and tucks TD rates, more 'wellbeing' from Housing NZ, Westpac NZ CEO in the money, local swaps are taking off again, dollar rises in sympathy
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Here are the key things you need to know before you leave work today.

MORTGAGE RATE CHANGES
No changes.

TERM DEPOSIT RATE CHANGES
Kiwibank's had a bit of a trim (by 10 bps) of most of its rates, particularly at the longer end, with the 2-5 year rates all moving down to 2.5%. The six month rate's also dropped by 10 bps to 2.65%. However, the 9-month rate's been put UP by 5 bps (now the highest in the Kiwibank range) to 2.75% 

MORE 'WELLBEING' BONDS ON THE MARKET
Housing NZ is dipping back into the bonds market seeking another minimum of $200 million from institutional investors that would take the amount of its 'Wellbeing Bonds' (maturity date October 5, 2026) up to a minimum of $700 million outstanding. An update issued later on Monday indicated the $200m was already "covered", while the issuer, Housing NZ, remained "open to upsize" the amount. The indicative issue margin range currently equates to an indicative issue yield of between 1.609% and 1.649%. The offer's due to close at 2pm Tuesday, or earlier at the issuer’s discretion. The offer is being ls being jointly lead-managed by ANZ and BNZ. The Wellbeing Bonds are a type of 'Sustainability Bond' that are also aligned with the New Zealand Treasury’s Living Standards Framework.

AUCKLAND'S BIGGEST REAL ESTATE FIRM GETS MODEST SALES LIFT
Auckland's largest real estate agency Barfoot and Thompson sold 824 residential properties in October, which was up 6.9%  from the 771 it sold in September but down 6.8% compared to the 884 it sold in October last year. However, October's sales were still well ahead of where they were in October 2017 (634) and October 2016 (778). QV's October data are expected to be released in the middle of this week.

WESTPAC NZ MAKES $964 MLN PROFIT
Westpac New Zealand's annual profit rose 3% helped by a turnaround in bad debts and the sale of the bank's 25% stake in electronics payments processor Paymark. Westpac NZ also retained its accreditation as an 'internal models bank' after completing an extensive remediation process required by the Reserve Bank following regulatory breaches.

WESTPAC'S NZ CEO GETS 12.7% SALARY BOOST WHILE HIS BOSS TAKES A CUT
Meanwhile Westpac's NZ CEO David McLean saw his actual pay (including amounts awarded in prior years), as disclosed in the annual report (page 54) lift by 12.7% to just under A$2 million, after he had been given a 10.3% target remuneration lift this year to "align his remuneration to the market". Westpac CEO Brian Hartzer declined a short term incentive payment this year and saw his actual salary paid drop to a little over A$4 million from closer to A$5 million a year ago.

FMA GETS COURT SUPPORT IN FXBTG DECISION
The Financial Markets Authority is welcoming a High Court ruling upholding a direction by the FMA to de-register foreign exchange firm FXBTG Financial Limited. In June, the FMA directed the Companies Office, as the registrar of the Financial Service Providers Register (FSPR), to de-register FXBTG Financial  because it wasn’t providing financial services to New Zealand customers.

EQUITY MARKET UPDATE
The NZX 50 was having a good day on Monday after some strong gains overseas at the weekend. The index was up nearly 0.6% at time of writing. Across the Tasman the ASX 200 was ahead by about 0.4%. Hong Kong and Shanghai were also up, but Tokyo was bucking the trend with some modest falls. 

LOCAL SWAP RATES DRIVE HIGHER STILL
Wholesale swap rates have again risen strongly on Monday as the markets continue to unwind the belief that the Reserve Bank will cut the Official Cash Rate again next week. Swap rates were up mostly by between +4 bps and +6 bps. The two-year gained +4 bps to 1.06% while the 90-day bank bill put on +1 bp to 1.13%.  Australian swap rates were by contrast marking time ahead of their central bank's call on rates due tomorrow. Mostly their swap rates slipped by -1 bp across the range. The Aussie Govt 10yr is up +1 bp to 1.14%. The China Govt 10yr is up +1 bp at 3.32%. The NZ Govt 10 yr yield gained +5 bps to 1.32%. The UST 10yr yield is up +2bp at 1.71%.

NZ DOLLAR MOVES UP
The Kiwi dollar gained more than quarter of a cent against the US currency from early Monday morning and at time of writing was a touch over 64.5 USc. Against the Aussie we have had a similar kind of gain to 93.3 AU cents, and ditto against the euro at just shy of 57.8 euro cents. 

BITCOIN DROPPING AGAIN 
Bitcoin was hanging in just above $9200, having dropped about 1.6% in the past 24 hours and over 4.3% in the past seven days. The bitcoin price is charted in the currency set below.

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12 Comments

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If Housing NZ bonds help fund government initiatives to relieve social housing pressures in NZ, then they could borrow more and do it faster.
The interest paid out on these bonds are a fraction of the billions that emergency housing currently costs the taxpayer.

Also, we generate capital assets and economic output (construction and asset management) when building social housing instead of adding pressure to our limited rental accommodation stock.

That is far too logical advisor. So it won't happen

Problem being is that our economy relies on housing inflation to create false wealth. If we didn't have a housing crisis, then we would have to create actual wealth. Which is far too sensible

She knows who pays the bills

Yeah
Bit hard to take her seriously on human rights

What do people think?
Are environmental issues (undescribed) more or less important than human rights, internment, organ trade, Fentanyl, HK.

Here is Melissa:
https://youtu.be/lLvW3_OgGUs

When is Mr Orr going to come out and be honest with us about the DEFLATIONARY cycle we have got ourselves into ?

CPI is being 'fudged " and PPI is unknown .

We really do have a problem , so why are they not being honest ?

Falsehood comes in many forms. Telling only part of the truth is a notorious way of misleading the unwary, and the method generally favoured by politicians since it is less easily exposed than a direct lie. A vote at an election is dictated by many things, only one of which is an assessment of the candidate’s honesty. Generally speaking, a candidate whose dishonesty has been exposed will nevertheless be supported in the election if he or she offers a sufficient inducement – lower interest rates, higher benefits, or whatever. Most people believe politicians lie. Some politicians lie more than others. There can be no legitimate policy reason why politicians should be allowed to mislead the people they are entrusted to lead.

https://www.parliament.vic.gov.au/images/stories/committees/emc/12Julian...

The international price of Natural Gas is falling ( and has fallen a lot already ) from $4,72 down to around $2,75 per million British thermal units

I wonder if those lower prices are going to feed through to New Zealand households , or we are just going to be screwed over by the Power Companies like we usually do

Given our hydro lake levels are about average for this time of year I doubt it'll make much difference at all.

NZ gas market is cut off from world so pretty irrelevant EXCEPT that it sets price for electricity at about 2x the (converted) $0.01/kWh gas price - or about USD$0.02/kWh. Aluminum production will inevitably shift to lower cost electricity supply in middle east.