Here are the key things you need to know before you leave work today.
MORTGAGE RATE CHANGES
There were no home loan rate changes today, but the NZCU Baywide group ended its personal loan 'special', bumping up its 8.90% rate to 9.90%.
TERM DEPOSIT RATE CHANGES
There were no term deposit rates changes today, but both Heartland Bank and the Police Credit Union cut savings account rates.
BUSINESS BORROWING TO PAY THE GROCERIES
The Government has announced it will write 'viable' small businesses loans of up to $100,000, interest-free for the first year, depending on how many employees they have. The borrower will still have to pay the principal back. The scheme seems to be unsecured lending to help businesses pay bills when they have no or suppressed revenues. How such businesses can be 'viable' in such a state isn't clear. Borrowing to pay operating expenses isn't something any adviser would recommend, apart from covering an in-month cashflow timing issue with an overdraft. This new scheme imagines borrowing for up to five years. Business lobby groups welcomed the news, of course.
CONSUMER CONFIDENCE DIVES
The monthly ANZ-Roy Morgan survey is out. ANZ says: "Consumer confidence fell 21 points in April to 84.8, about where it troughed in 2008 when the Global Financial Crisis hit. The net proportion of households who think it’s a good time to buy a major household item plummeted 67 points to -51% (18% thinking it’s a good time outweighed by 69% thinking it’s a bad time). Even when retailers are able to reopen their shops, they’re going to find the going very tough, with job security front of mind for consumers."
SHARP PULLBACK
StatsNZ released March home transfer data today. As you would expect, it shows that in late March the industry went into hibernation. Included in the data was transfers to and from foreigners. Foreign owners are quitting their NZ residential properties at twice the rate they are buying them, with sales of to foreign buyers down by 85% in the last two years.
PAYMENTS NZ HAILS PROGRESS IN OPEN BANKING
Payments NZ, the bank owned company overseeing NZ's development of open banking, has released version 2.0 of its API standards for payment initiation and account information. They leverage the latest UK open banking standards but are tailored to fit local market conditions, Payments NZ says. Meanwhile online payments provider POLi says retail transactions through POLi increased by 450% in April from March 2020.
SMARTPAY SALE TO VERIFONE OFF
Smartpay says its proposed sale to Verifone is off. Smartpay says revised terms from Verifone aren't acceptable. Smartpay has confirmed to Verifone that it considers the agreement cancelled and "has reserved its rights." Furthermore, the termination releases Smartpay from its restriction to seek other potential offers for the business, Smartpay says.
NO ACTIVITY BUT NO PRICE DROPS EITHER
According to the CoreLogic Home Value Index results out today, Australian housing values have not seen any evidence of a material decline in April, despite a sharp drop in market activity and a severe weakening in consumer sentiment. But prices did slip marginally in both Melbourne and Hobart in April.
LOCAL UPDATE
There are 1476 Covid-19 cases identified in New Zealand, with +3 new cases today, one more than yesterday. Nineteen people have died, unchanged from yesterday, almost all geriatric patients. There are six people in hospital with the disease (-1), but none are in ICU. Our recovery rate is now up over 85% and rising.
AUSTRALIA UPDATE
In Australia, there are now 6753 cases (up +7), 91 deaths (+2) and a recovery rate of just under 85%, marginally higher. 89 people are in hospital (-4) with 34 in ICU (-4).
GLOBAL UPDATE
The latest compilation of Covid-19 data is here. The global tally is now 3,256,600 and up +65,000 from this time yesterday which is an unchanged level of growth. Now, just on 33% of all cases globally are in the US, which is up +31,000 since this time yesterday taking the total to 1,069,400 and the only country to exceed 1 mln cases. This is also an unchanged level of increase. US deaths now exceed 63,000. Global deaths are about to exceed 233,000.
EQUITY UPDATE
The Aussie equities market is in a serious fall today, currently down -3.8% so far. That at least a -AU$70 bln daily dump. If it holds, that will mean week will end with a gain of only +1.5% rather than the rise to Thursday of +5.3%. The NZX50 Capital Index is down -0.4% near the end of trade today, and closing in on a zero weekly change. Earlier, the S&P500 was down -0.9%. Overnight, the European markets tumbled hard, down the thick end of -2.5% on the day. It is a public holiday in both Shanghai and Hong Kong so no trade there today. Tokyo is down a very chunky -2.3% so far today, but still heading for a +2.3% weekly gain.
SWAP RATES UPDATE
Update: Local swap rates fell again today, down to new record lows. The two year is now 0.19% and -10 bps lower in a week. The five year is now 0.33% and -13 bps lower in a week. The ten year is now 0.72% and -14 bps lower in a week. 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 is back down -1 bp to its record low of 0.26%. The Aussie Govt 10yr is down a sharp -6 bps at 0.87%. The China Govt 10yr is also unchanged at 2.52%. The NZ Govt 10 yr yield has crashed today down -15 bps to just 0.60% and now below the equivalent American rate. The UST 10yr is unchanged from this time yesterday at 0.62%.
NZ DOLLAR GIVES UP SOME GAINS
The Kiwi dollar has given up some of its recent gains, now back to 60.9 USc. But against the Aussie we are up more than +½c to 94.3 AUc. Against the euro we are down almost -1c at 55.7 euro cents. That means the TWI-5 is down to 66.8.
BITCOIN RETREATS
The price of Bitcoin has also given up recent gains, down -4.9% from this time yesterday to US$8,711 as the halving hype fades. 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 ».
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