A review of things you need to know before you go home on Friday; more rate cuts, more regulatory relief, tough on the farm and in the car yards, NZD stable, & more

A review of things you need to know before you go home on Friday; more rate cuts, more regulatory relief, tough on the farm and in the car yards, NZD stable, & more
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Here are the key things you need to know before you leave work today.

None today. But TSB has ended its Price Match Promise.

Westpac has sliced -15 bps off its TD rates for terms under six months and -10 bps for most other longer terms. And we know more reductions are coming from others on Monday.

The Government as signaled more business support measures in this crisis. They include temporary changes giving directors of companies facing significant liquidity problems because of COVID-19 a ‘safe harbour’ from insolvency duties under the Companies Act, enabling businesses affected by COVID-19 to place existing debts into hibernation until they are able to start trading normally again, allowing the use of electronic signatures where necessary due to COVID-19 restrictions, giving the Registrar of Companies the power to temporarily extend deadlines imposed on companies, incorporated societies, and charitable trusts and other entities under legislation, and giving temporary relief for entities that are unable to comply with requirements in their constitutions or rules because of COVID-19.

Rabobank released its quarterly farmer confidence survey. The results turned negative, as expected, with most now seeing a downshift in the rural economy. But probably what wasn't expected is that farmers' opinion of their own business prospects are now the lowest on record, more negative than either during the GFC or the 2015/16 period. Given that most of the rest of us think farming could be better insulated than the urban economy, it appears that view isn't one shared rurally.

And March car sales data out today shows them diving -36% from the same month a year ago. Rental car demand vanished. You would be hard pressed to think there will be any sales in April, falling to -100% perhaps. Worse are sales for commercial vehicles, down more than -40% in March with the same zero prospects. We haven't seen the used imports data for March yet, but that is also likely to be grim. Given the widespread loss of income, and the fact that most vehicles are sold with finance, it will be a long time before we see 2019 levels again.

EncoreFX has failed and is in liquidation. H/T Jason. A number of customers to whom the Company granted credit have defaulted on their obligations due mainly to the rapid changes in the FX market caused by the coronavirus pandemic. High volume, low margin trading platforms are at special risk of this type of stress.

Morningstar's assessment of KiwiSaver performance in March doesn't make pretty reading, although the drops aren't as large as for October 2008 in the GFC. The most aggressive positions took the largest hit (-14.9% since January, and -12% of that in March alone. Prior gains are all gone for anyone in for less than three years. Some profits are still there for KiwiSavers who have been in five year or longer. The April results from Morningstar could well be different.

In China, the private Caixin/Markit services PMI hasn't shown the same full recovery that their factory one did. It shows a still fierce contraction in March, unlike the official services PMI which claimed an expansion. Likely the Caixin survey is more realistic. (Also, the Aussie services PMI doesn't make comfortable reading either.)

The RBNZ felt it had to put out a special Statement today reassuring everyone that there is plenty of cash in "the system". With many bank branches closed, restocking ATM machines is becoming problematic and less frequent, but they are being restocked when access in available. At the same time, far fewer people are using cash, but those who aren't connected to the card-carrying part of society are at a sudden disadvantage. The RBNZ says it wants to have those people's back and is urging retailers still open to continue to accept cash, even if with due caution.

There are now 868 Covid-19 cases identified in New Zealand, with another +71 new cases today and lower than the +89 increase yesterday. The number of clusters has been risen to 10. Only one person has died here. There are still only 13 people in hospital with the disease today, one in ICU and stable.

Worldwide, the latest compilation of Covid-19 data is here. The global tally is now 1,015,000 and up +83,000 from the 932,000 we had this time yesterday. 24% of all cases globally are in the US and they are up +31,300 in one day to 244,700. Germany now has more cases than china, joining Italy, Spain and the US. Australia has now over 5100 cases, and 24 deaths. Global deaths now exceed 53,000. Death rates in Europe are frightening. Death rates in Asia are modest by comparison.

We don't have wholesale swap rates movement details today yet. We will update this later in the day. The 90-day bank bill rate slipped -1 bp to 0.48%. The Aussie Govt 10yr is up +2 bps to 0.77%. The China Govt 10yr is also up +2 bps at 2.68%. The NZ Govt 10 yr yield is still going against the trend, down -8 bps to 1.04%. The UST 10yr is up +1 bp today to just under 0.59%. At one point earlier today it hit 0.57% and a record low.

The Kiwi dollar has slipped slightly since this time yesterday to 59.1 USc. Against the Aussie we are unchanged at 97.5 AUc. Against the euro we are firmer at 54.5 euro cents. That means the TWI-5 is little-changed at 65.8.

The price of Bitcoin is firmer, up +2.5% in a day to US$6,804. The bitcoin price is charted in the currency set below.

This soil moisture chart is animated here.

The easiest place to stay up with event risk today is by following our Economic Calendar here ».

Our exchange rate chart (including bitcoin) is here.

We welcome your help to improve our coverage of this issue. Any examples or experiences to relate? Any links to other news, data or research to shed more light on this? Any insight or views on what might happen next or what should happen next? Any errors to correct?

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Popped over to Granny Herald (usually only lasts a few mins) today and clicked on something from high priestess Bindi Norwell related to the future prospects of NZ property. I'm sure many would lap it up, but it was rambling, unfocused waffle to me. That suggests (to me anyway) that even the most confident are really lost as to what the near-term future will bring.

If only you could short the NZ property market.

short banks and building companies etc

Banks will get bailed out. Buy just before they do...

NZ economy is being bailed out which is just as well. Still not enough imo I have seen many small businesses which will suffer heavily and all they're offered is 585 lol. Huge damage but for many their businesss will pick up where left off

At the very least it's top comedy.


Just read it. She's all over the place. Doesn't have a clue. Or perhaps more likely knows it's gonna be tough but is talking BS given she is the industry mouthpiece.

She is trying to mask her fear with that waffle. She is afraid.

Sharemarkets look like they are in the eye of the storm today.

Sharemarket has still not priced in the downside. Using the ups to remove a bit more.

"The results (of the Rabobank survey) turned negative... business prospects are now the lowest on record, more negative than either during the GFC or the 2015/16 period."

So this MUST be a sign we have seen the bottom, right!? When Bears are at their most Bearish, it must be a sign that the market is going to turn and the Bulls will have a field day.....After all, if you aren't in the market, now, you'll miss out on the upside....

Good luck with that this time! "Things" are going to get a whole lot worse, before they get worse...
Where is the bottom of this market then? When NO ONE wants to touch it with a barge pole, and at the moment "buy the dips; keep your existing positions in tact" is not that.


It's the fun of sharemarket investing; you never know where the bottom is. The gut churning horror as we roar down, the anticipation when the roller coaster starts heading up again and the stunning view from the top. Endless stimulating excitement.

Cocaine will get you through times with no stocks, better than stocks will get you through times with no cocaine.

Ah. The good ol' days! 15 years that exhilarating ride; captaining a band of pirates (loosely called traders!); day after day; on-call for 24 hrs of it 6 1/2 days a week; a young body can cope with that, until it can't. 3 months in hospital with severe exhaustion, and in a market where a day away is too long, and it was time to find a quieter life. But in the peace of the evenings, I do miss is it.. And guess what? In my recollections I , and my teams, haven't aged a day...

It's the fun of sharemarket investing; you never know where the bottom is. The gut churning horror as we roar down, the anticipation when the roller coaster starts heading up again and the stunning view from the top. Endless stimulating excitement.

Yes. I have the feeling that the next upswing could be epic. Enough for Trump to be seen riding a white horse.

It's entirely possible he has blundered into a policy position that when the dust settles after C19 waves 4 & 5 have passed, will prove to have been the best outcome for America in economic and overall social wellbeing and cohesion terms. That hundreds of thousands may from their covid death graves condemn him will be entirely lost on his preening ego.

Are the thousands of French dead going to be on Macron? How about Merkel and the Germans? Does Conte need to take responsibility for every death in Italy?

You scoring political points standing on the victims' graves is rather disgusting and pathetic.

The Treasury has today announced the appointment of the following joint lead managers to form the panel for the syndicated tap of the 15 May 2031 nominal bond:

ANZ Bank New Zealand Limited
Bank of New Zealand
Commonwealth Bank of Australia
UBS AG, Australia Branch
As previously announced, the Treasury expect to launch this transaction sometime next week, subject to market conditions. Link

I wish the government would suspend this tribute to foreign banking corporations. Moreover, the RBNZ LSAP programme is being undermined, because the rentier class that surrendered their government bonds, to eligible banks to submit to the RBNZ, in return for their savings, will have another chance to reinvest those savings for presumed capital gains at the taxpayer's expense. They should be investing those savings to fund productive GDP qualifying enterprises willing to employ citizens. Crowding out private enterprise while increasing the national debt is hardly model economics.

Furthermore, no new credit is created. Much better for the government to approach banks willing to buy it's IOUs and credit the crown account at Westpac with bank IOUs masquerading as deposits.

Re Rabo and farmers.
Took a look at grass growth rates today. Most of the top half of the North island is hovering around a big fat Zero. Heading towards winter that's enough to get any grassed based farmer squirming. And there's not a lot on the horizon to get excited about.

Theres a storm on its way. It looks cold as well but at this point I am saying any rain is good rain.

mid April is pushing it, frost season for us. Gov't needs to give me money.

I would love to know what's happening to exports, I'm not getting told anything and that makes it an impossible gamble.

Why does the Government need to give you money..?


why not, don't we all have our hands out? Am I not as worthy as the next guy.

Much rather you than speculators

There's been a bit written condemning the open letter with regards to farming suddenly being essential. While I didn't really like it the fact is the sudden change in status was a bit galling. And the fact you can expect a big fat nothing for your struggles as well.

Depends do your business not have any reserves...do you employ staff and applied for Grant?

It's ok we can always go back to eating each other

I just ripped around the lambs, all the neighbours are still feeding out, still brown but with a slight tinge of green, got a bit cold.

I agree. Time for some new thinking alright. And CoL call themselves the liberals. All they know is how to be luvveralls.


They talk some good talk but there is zero substance. I would argue they are the least competent and least talented government in NZ in living memory.


Sorry National over 9 years won that award...by a country mile.


I am no National fan. But neither can I be someone of blind faith who worships Jacinda just because I am nominally centre-left. This govt give me no faith.
I hope I am wrong and they blow me away with their competence over the next few months.

Well your hopefully alive so that's a start.

Not seeing any thumbs up there for your comment dude.

You may believe this, but the electorate doesn't and neither does anyone with eyes and a brain.

There has been a constant stream of f ups, cover ups, outrageous and broken promises and just general buffoonery from this lot. No other government comes close.

As a parent of two just eligible voter's, both who worship jacinda a year ago, both lost their PT after studies jobs, both said they will not vote for her again. They see labour as jacinda... interesting

I don't respect anyone in her cabinet.

Do you respect or trust any politician?

You shouldn't.

Market crash Friday.... How much do they pump in to try and keep it up?

They will be pumping for months but in the end they will fail.
Waiting for the main show will be some good buying but more so on ASX as NZX still trading to high and less volatile.

Pump it baby

Drop it all....

Good pick-up on Encore...

It would have been the forward trades that killed them.

Without asymptomatic testing [ ie everyone] the NZ stats for Clovid cannot possibly be right about actual infected people out there.
That is, there will be far more cases coming out there. Also means hard to see who and where from if there are no symptoms. Can JA really know when to cease lockdown? Unlikely.
Can docs find all the cases when testing criteria require there are respiratory symptoms? No. It is essentially a 50% invisible illness.
Here is the read:
A podcast interviews Andrea Crisanti, a professor of microbiology, who gives a pre-publication report of the results of testing the entire population of the Italian town of Vo, Veneto, for Covid-19. Veneto adjoins Lombardy, the worst hit province in Italy.
Vo recorded the first case of Covid19 in Italy.
3300 residents, all were tested
3% found to be infected
45% completely asymptomatic (cf estimates of 30% in China and 50% in Iceland)

100% agree with you, because most countries have tested about 1% of he population and most people infected don't know they have or had CV, the number of infected cases is probably 100 times higher than any country thinks. Which makes "eradicating CV via isolation" impossible. The upside is that, since there are many, many more infected people than the ones tested positive and on the other hand we know the amount of deaths accurately, the death rate is also about 100 times lower than estimates. I'm afraid that reaching herd immunity (min 60% of the poulation) is the only way to get over CV

Agree, but JA thinks she show the world the way, even if it costs 500k in job losses and bankrupts the country, but she show the world. There lots other options to get some of workforce back...but afraid they blinded by their own self believe now.

Agree Yvil. That means it is nowhere as bad as it seems. Especially for <50 years old. Which means we should get the economy going again asap. And not get hopelessly stuck focussed on increasing the age of the aged while destroying the future of the young , fit and vibrant.The country. We should not "Stay Calm" But protest the "Save Lives "focus as an error of balanced political action. We need to save our futures.

That is just wishful thinking. You need to educate yourself on this.

The number of infected is of course higher than the number of confirmed cases / positive tests , but nowhere near a factor of 100 greater .
More like 2-10 from country to country, depending on approach and number of tests carried out.
Latest modeling shows probable infection rates of 10-15% in Italy ,which gives IFR rates consistent with China at around .8-1% . Not as bad as the measured CFR rates ( 2-5%) but still very , very serious - and more than sufficient to justify to cost of the lockouts.

Suggest you look at Sweden's approach, much more balanced. They realise their be much more harm on health with a broken economy

Suggest you check the daily numbers of confirmed cases and deaths in Sweden - both growing exponentially.

The absolute numbers might look acceptable - while they are on the early part of the curve - but they only have a few days left before the unfortunate reality strikes.
They will be forced to change their approach , and soon. The financial costs of going to lock down late will not be less at the end ; the death toll much greater.

We have seen sequence before ( UK , Netherlands .. ) - the result is invariably the same .

What lockdown?

I live in New Plymouth.

After spending the last 3 days on the phone to various doctors. I had to go out today and pick up a prescription for my young son (who has been very ill the last week and a half). It is the first and hopefully only time I will need to leave the house during the lockdown.

The drive to the pharmacy is 1.1km. The closest pharmacy is inside our local countdown.

Driving there: 27 other cars on the road. 38 pedestrians, 4 cyclists.

At the supermarket, 40-50 People in masks buying "essential" groceries. Some examples include:
- 2 bottles of wine and some Camembert
- Carton of beer and 2 bags of chips
- Ice cream, Chocolate, and wine
- Easter eggs
- Frozen chips and a frozen pizza.
There was also a lot of "catching up" with clearly non-bubble people side by side in the aisles.

For the record as I was in countdown. I got two loaves of bread (the limit) and a bottle of milk (The powdered stuff is ok, but if I am there I might as well get fresh). I was the only person at the pharmacy and I was in the Supermarket for 15 minutes (12 of which were standing waiting at the pharmacy)

Drive home. 15 cars on the road, 26 pedestrians, 3 cyclists.

I say again What Lockdown? I hope everyone is enjoying their 4 week govt bailed-out holiday.

Right, so no one is allowed anything but milk and bread? Sounds like noncents.

Missed the point much? I wouldn't have even gone out for those things if it wasn't for the prescription.

The idea is to go for "Essentials". So that you limit the time out of your "bubble". Going to the shops 1-2 times daily for minor purchases is just plain idiotic.

Good grief. We go out every day. Drive to start of bike track. Bike along track and then road to Pak-n-Slave. Put few things in pannier bag. Have yarn with people we invariably bump in to. Then bike back to car. Most days. Plus firewood trips to beach. Watercress trips. etc etc. The government will have to stop lockdown in spite of their "experts" opinions, because otherwise we will just stop it for them in a few weeks, regardless of what they say.

You are right. We have needlessly destroyed tens of thousands of businesses and potentially hundreds of thousands of jobs. Simply because people cannot stay home.

We should have just rolled the herd immunity dice and seen what happened. The average kiwi appears to be doing this anyway.

"We should have just rolled the herd immunity dice and seen what happened." - we have seen that play already -in Italy. Is that what you wish for ?

No it is not what I wish for, and that is not my point at all. But it is exactly what is happening.

If people do not start taking this lockdown seriously, then tell me - what was the point?

I wouldn't be surprised if I'd had the virus in February after returning from overseas. Having never been so ill in my life I stayed home, off work. The two main symptoms were persistent dry cough which lasted 4 wks and the world's worst fever. A ton of other symptoms too but those are the two NHS focus on. Anyway, due to having always been fastidious about hand washing, wiping my workplace in the office and every other surface known to man, not coughing around people, going outside to cough, washing hands some more... I either didn't pass it to anyone including my partner. Unless they were asymptomatic.

But then they didn't report passing it to anyone else either. I called my doctor and health line to get a test but they said no. So unless there's an antibody test I'll never know if I had it, and maybe I didn't, except I had those two key NHS symptoms. Anyway the point is how did I get over it... rest, stay away from others, wash hands, cough away from others outside, suffer through and take a ton of anti viral remedies FWIW.

What I'm saying is if I had it, I got over it. Yes it was like the worst flu I've ever had and lasted for ages, BUT I survived because of a strong immunity and doing the right thing.

What isn't the right thing is destroying jobs and the economy for millions. This - in Jacinda's words, ABSOLUTELY has to stop. Labour as usual are blinded by ideology, are wtf out of their depth and are dragging us all into an utterly desperate situation. It has to end now or people's lives if they haven't been already will be utterly ruined.

The only positive I take from this is the COL could lose the election over their handling of this by wrecking things so spectacularly.

Zero confidence in their ability to deliver a solution to rescue the economy. Come on... Twyford? Really??

So you are saying you might have had it (not that either of us know ) and you think you have not passed it on ( again , you do not know ) . From that it follows that the lockouts are not worth it. Logic ??

I would point to our death, extrapolate back from that and say our total infection rate is very low. It's when you have multiple pneumonias popping up in the hospitals that turn out to be Covid, that you know there's an army of unidentified infections. But at the moment we have one death and 13 hospitalisations, so I think we've done ok so far. The border is a big f***** issue though.

definitely too early to buy but soon it could be too late to sell.if its spare change you are gambling with no worries,otherwise,know when to hold them,know when to fold them.

Fake data in China. Who would have thought? Btw, where is X? Miss him.


Have you ever perused IFRS approved US corporate proforma accounting statements - more exclusions than inclusions. That's why the Fed has been approved by the US Treasury to employ a taxpayer funded ten times leveraged $450 billion SPV to buy approved US corporate debt securities.

I am tired of the western world MSM effectively saying constantly 'look over there' while ignoring the glaring policy gaps overwhelming their own nations.

Sounds like repatriation flights have begun. Perhaps he already repatriated a bunch of masks and hand sanitiser?

Correct me if I'm wrong but providing a "safe harbour" for companies in trouble and allowing them to put their debt "into hibernation" are fancy words for saying "you don't need to pay your bills on time".

If that's the case, I have a problem with this "business support". Let's say you have a business, you are, like most, affected by the lockdown (not by CV, but by the lockdown) and you want me to pay what I owe you, so you can pay your bills… Sorry mate I'm not going to pay you, I'm putting my bills into "hibernation" and you… well you'll have to do the same or you'll collapse and so on. It's a catastrophic rule!

I thought the same thing. Creditors are, well that's their business. They would have to cry "safe harbour!" too. I do support JA's "be kind" message but not the "feel sorry for businesses" message. There's a difference.

Fastest growing company in NZ ....winz.. good luck paying for that through taxes

Yes taxes - the empty space in the room where the elephant was.

GST take is going to be minimal during lockdown.
PAYE is going to be minimal once the job losses really take hold.

Where exactly are we getting the tax revenue from?

Good question. Ask Grant.

Well I would prefer the media to do it for me - after all isn't that their job?

Their "essential" service?

The government doesnt need tax revenue
That was under the old rules when Inflation existed
The rulebook is out the window
Every country runs equally ridiculous deficits and your currency still holds it own...

Whoop whoop 2020 is here and the robots do it all for us and we just do whatever we want.

European producers in need of third world labour to underwrite a claim to first world lifestyles.
Farmers across Europe bank on improvised armies of pickers to save harvest

There are about 50,000 farm hands on the Turkish border waiting to cross into Greece

they need those workers to give the supermarkets a decent margin.

I thought Lidl wiped that nonsense away.

we need to lay out the welcome matt in NZ, be great to have both of them over here

I am going to leave my DGM nature behind for a moment and be positive.
We will be out of lockdown in 3 weeks.
The government will have a plan that balances a move back towards semi-normality

We will have some drugs in 3 months that will help mitigate serious infections.

Unemployment will 'only' rise to 9.5%.

How's that?
Am I a reformed DGM? Or just one who has drunk too much vino???

I'll pour you another virtual glass...red or white

Almost always red but don't mind the odd chardonnay...but don't call me a chardonnay socialist.
An oaky, buttery chardonnay please

Good comedy thanks.

Needed that of a Friday evening.

Welcome. Cheers

Every single outlet I have been to is banning physical cash. So how is this paper money of any value? What do I do with it?

Technically illegal. Cash is legal tender and so vendors are legally required to accept it in consideration for things they are selling.

Michael Reddell (in one of possibly his last-ever blog posts - he'll be missed) again notes the absolute and total lack of even a cursory cost-benefit assessment of policy choice, riffing on Matthew Hooton's Granny Herald article.

This was the government that some time ago committed itself to much greater transparency around the release of Cabinet papers. It was a pretty good initiative at the time. But as far I’m aware we have not seen a single Cabinet paper or any of the key officials papers on any aspect of the unfolding crisis, whether health or economic. And in particular we’ve seen nothing that sets out any sort of cost-benefit framework that is influencing the government’s decisions (thus the Otago health modelling is useful in its way, but in isolation it adds not much to our ability as citizens to either evaluate the choices/processes the government is using, or to reach a view on the best way forward). We just get the latest lurch.


Fantastic statement /opinions from Michael Reddell, thank you Waymad. Could not agree more with his entire blog. Essentially government on a power trip, hiding essential truth behind rhetoric. With devastating consequences as we are beginning to see and extrapolate our discussions to. Who will save us?

There is a very good comment by a Robert H.

Aust infection rate about the same as ours. At least 2 thirds of ours came directly from overseas or are their close relatives. Extremely low death rates in both countries. After the LD nz and Australia should work.more together given that they are our largest tourist market.

Can we trust the govt or not? Do we believe their testing methodology, or not? Perhaps come monday there may be a flurry of new deaths, let's say 3. They in fact perhaps died last week, but there were understandable delays in getting the coroner reports. In fact, perhaps there was such a shortage of tests kits, the govt didn't see the point of wasting them on those who had already passed away. Wish I worked for the govt as a spin doctor, how about this one. "After extensive research from the lads and lasses, in Matamata, it has been discovered that the incidence of covid 19 in NZ is one of the lowest in the world as a result of in-flight radiation. Yes, it's incredible, the few cases we did have in NZ turned out to be imported,( because it could not possibly have been community transmission). It became clear when the actual altitude, and flight time data were analysed and a clear correlation was established between those few with covid 19, that traveled by sea, or short, low altitude flights, and the much larger group, where such low numbers of cases were found, who had flown long distances, at 34000 feet, on a sunny day. " Quite amazing, and what a way to put Air New Zealand back on the map!
The countries been fed so much rubbish, I can see this idea being accepted as completely realistic.
Ultimately I think those in power have carefully calculated when and how to feed the mortality rate into the media machine, using a mathematical equation that confidently predicts the chances of anyone actually knowing someone who dies. After all, it's only when we start losing people we know that the whole thing gets real.
We will simply have keep our fingers crossed, and hope for the best. Have a good weekend.