Here are the key things you need to know before you leave work today.
MORTGAGE RATE CHANGES
Kianga Ora/HousingNZ have cut their floating and fixed rates today. Their new floating rate is market competitive. Their fixed rates tend not to be.
TERM DEPOSIT RATE CHANGES
NZCU Auckland (NR) has a six month 'special' TD rate of 3.10%. Liberty Financial (BBB-) have trimmed their whole rate card.
BIG BILL
1,073,129 workers, comprised of 914,931 employees and 158,198 sole traders, are now having their wages subsidised for up to twelve weeks. This represents more than 40% of the workforce. The million-worker milestone was reached following $1.25 bln of payments made yesterday (April 6), taking the total paid out to $6.6 bln. This is expected to rise to potentially $12 bln. If it stops there, this scheme alone will be equivalent to 4% of annual GDP. (In 2019 payments to employees amounted to about $135 bln or 45% of GDP.)
DOWNHILL, BEFORE THE AVALANCHE?
"Business confidence has well and truly been snuffed out by the coronavirus according to NZIER’s quarterly business confidence survey. But NZIER’s survey likely understates the future hit to economic activity. Headline business confidence plunged over 40 points to show a net 67% of firms expecting deteriorating general business conditions ahead. The reading was on par with the depths of the GFC. However, domestic trading activity, a better fit with GDP, fared much better. With only a net 12.7% of firms expecting a contraction in their business activity over the coming quarter."
DO AS I SAY, NOT AS I DO
What is it with cyclists and ignoring rules - repeatedly? In this case he was the rule-maker.
BIG, FAST PLACEMENT
The Treasury today sold an additional $3.5 bln of May 2031 Government Bonds via syndication. They achieved a yield to maturity of 1.4025%. Following today's issue, there will be $6.4 bn of May 2031 bonds outstanding. The deal with Treasury was done by ANZ, BNZ, CBA and UBS. They will then offer them to their client base. They are likely to be traded on the NZDX via brokers.
RAIN FADE SIGNAL FROM BOND INVESTORS
The yield to maturity of Sky TV's 31 March 2021 6.25% coupon bonds (“SKT020”) increased from 4.08% on March 17, 2020, to 80% at midday yesterday as investors took fright at the company's survival prospects in the current media market. Today these same bonds yield 40%, a one day improvement that doesn't actually mean much. The company has become a penny dreadful with their shares trading at just 27c.
EX-ASB EXECUTIVE LINLEY WOOD JOINS BNZ BOARD
Linley Wood, who spent 25 years in ASB's executive leadership team, has been appointed as an independent non-executive director of BNZ, effective April 14. Wood is also a director of the Financial Services Council, Auckland City Mission Foundation, Auckland City Mission, and is deputy chairman of the King’s School Board of Governors.
'A VERY GOOD EFFORT'
Auckland Airport's emergency capital raising has been successfully completed. The placement was fully subscribed at the price determined in the bookbuild of $4.66 per share. This represents a discount of -7.5% to the last close price of $5.04 on 3 April 2020 and a discount of -9.5% to the 5-day average price of $5.15. In the circumstances, for a company at the core of our tourism sector, this is a very strong showing of support.
LOCAL UPDATE
There are now 1160 Covid-19 cases identified in New Zealand, with another +54 new cases today and lower than the +67 increase yesterday. That is the lowest daily increase in 13 days. The number of clusters has risen to 10. Only one person has died here. There are only 12 people in hospital with the disease today, but four are now in ICU. 21% of all cases have recovered (25% of all confirmed cases).
GLOBAL UPDATE
Worldwide, the latest compilation of Covid-19 data is here. The global tally is now 1,348,000 and up +74,000 from the 1,274,000 we had this time yesterday. 27% of all cases globally are in the US and they are up +30,700 in one day to 368,000. The Americans are claiming the disease is peaking there, but there is no real evidence actually. Five countries now have more cases than China. Australia has now over 5800 cases, and 40 deaths, but there does seem to be a peaking there. Global deaths now exceed 75,000. Death rates in Europe are frightening. The UK's is 10.3%. But both Austria (1.8% death rate) and Denmark (3.8%) have announced plans to ease their lock-downs. Death rates in Asia are modest by comparison.
REALLY?
New York investors got very bullish on the prospect the virus may have peaked. The S&P500 ended up +7% on the day, a very unusual one day gain. But it isn't flowing through to investors elsewhere with such optimism. The NZX50 Capital Indes is up a goodly +1.7% so far and the ASX200 is flat so far today. At the open, Shanghai is up +1.7% (after being on holiday yesterday), Hong Kong is up +0.7%, and Tokyo is up +1.3% all in early trade. None of them are really buying all the American's bullish tone. The question will be, before the Easter break, can Wall Street sustain it, or is it just the now-too-familiar volatility.
SWAP RATES UPDATE
Yesterday, swaps fell at the short end but held at the long end, steepening the curve. Update: Today they held at the short end and rose at the long end, further steepening the curve. We don't have wholesale swap rates movement details today yet. We will update this later in the day if they show a significant change. The 90-day bank bill rate slipped -1 bp to 0.47%. The Aussie Govt 10yr is up +6 bps at 0.82%. The China Govt 10yr is down a sharp -9 bps at 2.53%. The NZ Govt 10 yr yield is up +5 bps at 1.09%. The UST 10yr is up +6 bps today to just under 0.69%.
NZ DOLLAR FIRM
The Kiwi dollar is up +1c from this time yesterday at 59.6 USc. Against the Aussie we are little-changed at 97.4 AUc. Against the euro we are also up, up by +¾c at 55.1 euro cents. That means the TWI-5 is now up to 66.5.
BITCOIN UP
The price of Bitcoin is also rising strongly, up +6% in a day to US$7,289. 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 ».
74 Comments
The biggest laugh i've had all week. Poor, poor Mike Hosking.
https://www.reddit.com/r/newzealand/comments/fvq26z/poor_mike_hosking/
mike Hosking reminds me of a monkey at a typewriter 99% nonsensible and occasionally can put a sentence together,
he is so biased its not funny no way can he take certain politicans to task because that comes through in his questions.
this is the same guy that said covid 19 is not a problem then changed his tune, said the government should stay out of the economy then changed his tune
said we need to shut the country down then said we don't need to shut the country down
https://www.rnz.co.nz/national/programmes/mediawatch/audio/2018741210/m…
Nahh this is funnier "DO AS I SAY, NOT AS I DO": BBC Coronavirus: NZ health minister breaks lockdown at beach. David Clark admitted the 12-mile (20km) drive was "a clear breach of the lockdown principles".
He offered his resignation to Prime Minister Jacinda Ardern, but kept his job because of the ongoing crisis. https://www.bbc.com/news/world-asia-52194407
Two worst presidential candidates ever, potentially. Well, there's probably a lot of competition there. These guys certainly got it right: https://www.youtube.com/watch?v=GI8Wwe2-dV0
When's Trump going to lock her up, Kezza?
Arghhhh.... Why couldn't it be Trump!!!! At least Boris is a lovable idiot. Aljazeera: US recommends face masks, Trump says he will not follow advice.
US health officials tell people to wear face masks as infections soar past a quarter of a million. https://www.aljazeera.com/news/2020/04/recommends-face-masks-trump-foll…
Yeah that Trump is an idiotic for bagging face masks.
Glad our two top docs are so much smarter - https://www.health.govt.nz/news-media/news-items/covid-19-media-update-…
bit cheeky of the supermarkets to apply even though they are still operational and doing best sales other than xmas
https://www.stuff.co.nz/business/120876197/new-world-stores-will-withdr…
ICYMI: New World or PAK' n SAVE stores will need to withdraw any wage subsidy applications and pay back any government funding granted, Foodstuffs says. https://www.rnz.co.nz/news/national/413690/foodstuffs-stores-withdraw-w…
Interesting I wonder if New World Waikanae lost sales as it is not a tourist hot spot or if they claimed and then realised they were not entitled.
I understand Wanaka Queenstown being down I think this needs a follow up by someone in the media as I think these supermarkets are making plenty of profit.
David Clark did not break the rules laid down in the Health Order. Read it for yourself.
https://www.health.govt.nz/system/files/documents/pages/covid-19-sectio…
You could state the rule as a request rather than lawful order. Proof is they have amended to order to try and make it lawful. I doubt that it is. The addition is by including section 70(1)(f) to section 70(1)(m). Personally if I was charged for breaching the order I would be defending it by stating the order did not name me, or my street, or the public place I was on. A lawyer would have fun with this.
http://www.legislation.govt.nz/act/public/1956/0065/latest/whole.html
To me a Health Order is meant to be evidence based, and response driven at a district level. The powers for information gathering and testing are there to collect this evidence. The Health Act does not, to me, empower a univeral nation wide lockdown.
More interesting is that the Healh Act doesn't give any specific powers to stop motor vehicles or stop going about their affairs in public unless they are suspected of being infected.
Sorry you are missing the point. The point is those entrusted with the law are acting unlawfully (just not in the way media are portraying it). Doesn't matter what circumstances exist. It is about your civil liberties. If you want to give one up, which one do you want to give up next? This one is section 22 of the Bill of Rights Act, the freedong to go where you like without being arbitraritly arrested or detained. Think carefully about what I say above with reference to the word "Arbitrary".
the problem was the conflicting messages, the PM said yes you could do what he did when he went for a bike ride, then the police and health boss say no you cant do that
the 20km to the beach was taking the p though but then you have the leader of the opposition driving 400 kms, there is no clarity or consistency on the rules
That is a political issue, not a technical one, and I agree with you. I also agree with the social distancing, no problem with that it is a no brainer and it is lawful. But it is over stepping the mark(actually unlawful) to stop people undertaking outdor activity, or even just walking down the street. They can required this if they have evidence, but I'd think the evidence gathering has been sadly lacking despite all the authority in the world to do so. They are using the wrong tool in the toolbox.
Ok, maybe the government hasn't dotted the i's and crossed the t's properly.
But apply a bit of common sense and see what it is we are trying to achieve with the lockdown. Letting people through loopholes would just make the whole effort a shambles.
If the boot was on the other foot and a cop pulls you up for your rego being 1 day overdue, you would surely want common sense to prevail over the letter of the law.
There's a difference between committing an offence and the police officer electing not to prosecute / fine you, and not committing an offence and having a police officer decide to prosecute / fine you because they believe that you did break a law, even though you didn't.
It's a bit beside the point when talking about David Clarke though - no one is saying he broke a law so must be sacked. They're saying he broke a rule of the lockdown. Different thing.
Simon Bridges as Chair of the COVID committee has asked today, to see all the legal opinion that was given to govt re this 'rule'. He has got legal opinion that states that it was not lawful, so wants to review the advice the govt got. As there may be some legal privilege associated with handing it over, he wants to know in that case, why they won't hand it over.
The Treasury today sold an additional $3.5 bln of May 2031 Government Bonds via syndication....The deal with Treasury was done by ANZ, BNZ, CBA and UBS. They will then offer them to their client base.
An easy sell given $5.780bn of the 3.0% 15/04/20s mature on the settlement date and the RBNZ has already paid out $2.05086bn to partially retire them ahead of redemption in OMO liquidity injection/settlement smoothing actions.
Further to the above "There are now 1160 Covid-19 cases identified in New Zealand, with another +54 new cases today and lower than the +67 increase yesterday." ICYMI: Coronavirus: New Zealand Health Ministry is being accused of giving conflicting information about stocks of nasal swabs - alternative testing method has been described as "incredibly inaccurate" https://www.newshub.co.nz/home/new-zealand/2020/04/confusion-over-the-s…
the trouble with the data is the lack of clarity, are they testing everywhere? they didnt start testing in otara until last weekend and all of a sudden cases in counties manakau and the PI community have started to rise.
they are not retesting the infected to make sure they are recovered but that is done by a phone call asking a bunch of questions, not even a visit by a district nurse.
then we had the police say they would visit all the returnees within three days to make sure they were isolating and then turns out they are not visiting at all.
what about up north, new world worker had it and i have been to that shop and its tiny, and we know the two biggest clusters were created by one sick person at a group gathering
still a lot of gaps before we can say yes we have this under control.
i suspect certain regions will remain locked down for an extra fortnight
The death of television is something I've often dreamed about. It won't happen of course, but that doesn't stop me wanting it to happen. If you wanted an simple answer to most of our cultures ills, temptations, poor behaviour, foul language, murder & other assorted indecencies, then look no further than the television set in your living room.
Can someone please explain to me the relevance of the credit card "time bomb" in the context of the current crisis.
Customers pay for their groceries, fuel or whatever with credit card. Lots of reasons to pay with CC, with free use of money and airpoints pretty high on the list, six weeks later customer cant pay CC bill, limit is reached, and bank reverses original transaction. Original supplier is now loosing money fast, and wont accept credit cards any more, free use of money no longer exists, and all hell breaks loose. Have I missed something.
Are you serious? 6 weeks later the transaction is reversed....thats not how credit cards work, most just keep accepting until the cows come home. If the customer defaults and the bank cannot screw money out of you the debt is sold to a debt collector who will threaten you with all sorts of lies to make payment. Just tell them to make you bankrupt and that shuts them up.
I am a credit card merchant, that means I accept payment for services by CC, and it was explained to me very clearly when I signed up. I know of a colleague who several years go provided a shuttle service, paid by CC, and it was reversed 6 weeks later, when the CC was unpaid.
Your vested interest in personal wealth has superseded your humanity. Are you blind? Are you watching the telly? Listening to the wireless? Tens of thousands of people are dying, hospitals are overwhelmed in Spain, Italy, the UK and US.
New Zealand is doing everything to avoid this and all you can think about is losing your unearned capital gains.
the interesting part will be the recovery, at the moment countries have closed borders so tourism is dead, BUT once they develop a vaccine 12 months to two years how quick will it come back, if you look at air nz they are planning for five years +
can Queenstown, Rotorua survive for five years. they both treated local tourism as extra not the base so unless they reinvent themselves they have a problem.
the other part is all the imported workers that were brought in to service tourism and cafe's will they be sent out or are we stuck with them.
Up until now, in normal times, dollars have been more important than saving human lives.
Certain drugs for cancer are very expensive and not available because of this. Social programs like lack of healthy public housing for everyone, suicide prevention programs, more humane prisons and more extensive rehabilitation programs. There are waiting lists for surgery because of not enough doctors and facilities yet hundreds of capable people cannot train to become doctors. All this could be fixed with money.
A national program of annual full body scans for everyone with immediate medical intervention would save a lot of lives.
Extend the lives of people to 120 or more with more machinery to take over the functions of the heart and lungs. A lot more could be spent in the area of cybernetics I feel.
All roads could be greatly improved to reduce accidents. Also reduce speed limits everywhere to 30km. This would use more fuel and waste time but save thousands of lives.
We could do a lot more than we already do to save lives. The money is there or we could have borrowed a lot more especially with such low interest rates, also taxation could be significantly increased up to pay for a lot more, a whole lot more. Without doubt tens of thousands of human years could be extended with the expenditure of huge amounts of money.
ICYMI: New World or PAK' n SAVE stores will need to withdraw any wage subsidy applications and pay back any government funding granted, Foodstuffs says. https://www.rnz.co.nz/news/national/413690/foodstuffs-stores-withdraw-w…
Can't rule out 30pc fall in house prices
From the 'ever' property bullish AFR.
https://www.afr.com/property/residential/unsold-home-numbers-surge-as-b…
They're all bullshit not bullish. But then again they have to earn a living.
I'll tell you that you can't rule out a 90% fall in house prices with my hand on my heart, and I'll also tell you that you can't rule out a 1.75% fall in house prices........I just consulted my random answer generator.
I see on the news tonight that there is a desperate national shortage of nasal swabs to do the best form of testing for the virus. The media canvassed a few of the top tech start-ups today to see if they could step up and make some, but the responses were all much the same and along the lines of: "Nasal swabs are far too technically difficult to manufacture, and we think it's really more important to further the development of our Ponsonby-streets parking App."
Mean while in the south china sea....
https://edition.cnn.com/2020/04/07/asia/coronavirus-china-us-military-s…
by scarfie - I think you're dreaming. 50% of pork in NZ is imported, and virtually no NZ product is exported, so our prices unlikely to go down. Compared to vaste majority of lamb and beef exported, so plenty of availability likely. NW yesterday had beef fillets special at 50% off.
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