Here are the key things you need to know before you leave work today.
MORTGAGE RATE CHANGES
First Mortgage Trust cut its [very high] floating mortgage rate of 7.25% by -50 bps to [a still high] 6.75%. Most banks have a floating mortgage rate of about 5.20%.
TERM DEPOSIT RATE CHANGES
None here today.
INTERNATIONAL CRASH
The international situation is dire today. Before Wall Street even opens, bond yields have dived further, with the UST 10yr down to 0.49%. That is a -25 bps crash from Friday's record low rate, itself a -39 bps dump in a week. Never before have all UST yields all been below 1% and that now includes the 30yr. Gold has jumped to almost US$1700/oz in non-New York, non-London trade and a +US$16 rise from Friday. Tokyo equities have opened down -4.7%, Hong Kong is down -3.9% at the open and Shanghai is down -1.2%. Locally, the ASX200 is down -5.6% and the NZX50 Capital Index is down -2.5%. The US oil price, which we reported was down to just US$41 this morning, is now down to under US$32.50 while the Brent benchmark is under US$37. This crash is all due to a Russian/Saudi punchup which Moscow had hoped would penalise the American shale industry. But it has gotten away on them in a few hours.
INTERNATIONAL CRASH - UPDATE 4:20PM
Since we first published, some big changes have continued to evolve. The US crude oil price is now down to US$30/bbl, a further -8% drop in just a few hours. The UST 10yr yield is holding low at 0.51%. Gold has pulled back somewhat to US$1682/oz. The NZX50 capital Index closed down -3.0%, the ASX50 is heading for a -5.4% rout. Shanghai is now down -2.5% for the day, Hong Kong is now down -3.6% and Tokyo is down an eye-popping -6.2% (and not helped by a very weak GDP result).
BNZ SEES RECESSION
BNZ now says a recession is now probable for New Zealand. They follow ANZ who earlier saw that it was increasingly likely globally.
GOVERNMENT PREPARED?
Here is our Government's latest updates and advice on Covid-19. There will be many more senior updates coming later today.
SHARP DOWNGRADE
Air New Zealand has today said it is withdrawing the full year 2020 earnings guidance of "$35 mln to $75 mln" it issued to the market on 24 February 2020. It also cut the pay of its newly appointed CEO by -15%.
LOCAL SWAP RATES DOWN
Wholesale swap rates have dived at the long end with the ten year down to 0.95%, another fall of -7 bps. The 90-day bank bill rate however is up another +4 bps to 0.84% as markets unwind their local rate-cut bets. In Australia, their swap curve flattened further although in the international context it is not huge. The Aussie Govt 10yr is down -12 bps at 0.58%. The China Govt 10yr is also lower, down -14 bps to 2.58%. The NZ Govt 10 yr yield is now just under 0.86%, and a -14 bps fall.
NZ DOLLAR DIVES
The Kiwi dollar has also crashed lower, now at 61.9 USc and down more than -1c. Against the Aussie we are unchanged at 95.6 AUc although volatility is rising. Against the euro we have dived to 53.8 euro cents, a drop of over -2c. That means the TWI-5 is sharply lower at 66.2, a -4.3% devaluation today alone.
BITCOIN SINKS
Bitcoin is now at US$8,209 and down -10.2% from where we left it on Friday. The bitcoin price is charted in the currency set below.
This chart is animated here.
The easiest place to stay up with event risk today is by following our Economic Calendar here ».
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