A review of things you need to know before you go home on Thursday; significant rate cuts, credit card spending dives, hot demand for NZGBs, swaps low, NZD firmer, & more

Here are the key things you need to know before you leave work today.

MORTGAGE RATE CHANGES
ANZ cut almost all its fixed mortgage rates, including taking their one year fixed rate down to 2.79%. TSB followed. SBS Bank also cut rates, including a 2.99% one year rate..

TERM DEPOSIT RATE CHANGES
ASB cut term deposit rates today by between -10 and -20 bps across the board. When rate levels are this low, cuts of this magnitude qualify as 'significant'. ICBC and Kookmin Bank also made significant term deposit rate cuts. TSB have cut term deposit rates too.

DIVE, DIVE
Credit card spending crashed in April (of course), down more than -$1.5 bln from March, and down almost -40% from the same month a year ago. That means that the balances owing took a dive as well, down by -$1.1 bln at the end of April from the end of March, and down -20% from the level in April 2020. Early indications (March) are that credit card customers are not letting the balances incurring interest rise, but we won't get a proper fix on that until the May data is available in June. More here.

HOT DEMAND, LOW RATES
Another very large offer of NZ Govt bonds today with a three-part tender. They offered $500 mln for April 2025s and that drew $1.6 bln in bids. The resulting yield was just 0.22% pa. They offered $350 mln for April 2027s and that drew almost $1.1 bln in bids, resulting in a yield of just 0.37% pa. And they offered $300 mln of April 2033s drawing $600 mln in bids and bringing a yield of just 0.73%. All these yields are sharply lower that at the prior tenders just two weeks ago. All up, $3.3 bln was chasing just over $1.0 bln on offer.

HARD TO FORECAST
Fonterra has revealed its level of uncertainty over the milk price for the new season. It says that is due to unusual global uncertainties. It's mid price for current season is now set at $7.20; earnings for current year still picked to be between 15c-25c a share. Full perspective is here.

LOCAL UPDATE
We now have had ten straight days where there are no new cases. The total is still 1503 Covid-19 cases identified as either confirmed or probable. Twenty-one people have died giving a death rate of 1.4%. There is only one person left in hospital with the disease, and they are not in ICU. Our recovery rate is now just under 97%, with only 30 people known to be still fighting the infection (-5).

AUSTRALIA UPDATE
In Australia, there are now 7081 cases (+8 since yesterday), 100 deaths (unchanged) and a recovery rate of just on 91%. 43 people are in hospital there (-2) with 9 in ICU (-3). There are now 535 active cases in Australia (37).

GLOBAL UPDATE
The latest compilation of Covid-19 data is here. The global tally is now 4,995,700 and up +98,200 from this time yesterday. Now, just 31% of all cases globally are in the US, which is up +23,000 to 1,551,700. US deaths are now exceed 93,000. Global deaths now exceed 328,000.

"TIME TO USE YOUR BUFFERS"
The head of the RBA is calling on Aussie banks to run their "large capital and liquidity buffers" down, previously built up for operational resilience, to assist the central bank and fiscal authorities meet the challenge of the recession starting to bite there. Depositors might have a different view. And so might credit rating agencies.

GETTING HEATED
The Australia:China trade tiff is getting serious. China has changed its inspection procedures for iron ore imports under new rules that analysts say could be used to block Australia's most important export. The Americans aren't helping, cheering the Aussie and jeering the Chinese from the sidelines. China notices.

EQUITIES UPDATES
Earlier today, the S&P500 ended its session up +1.7%. Prio to that, European equity markets were also up, generally more than +1%. At their open today, Shanghai and Hong Kong are marginally higher, Tokyo marginally lower. The ASX200 is heading for an unchanged session while the NZX50 Capital Index is losing steam and looks like it will close -0.1% down after rising +0.5% earlier.

SWAP RATES UPDATE
We don't have wholesale swap rates movement details today yet but early suggestions are that they have firmed marginally. We will update this later in the day if they show a significant movement. The 90-day bank bill rate is marooned at its record low 0.25%. The Aussie Govt 10yr is -2 bps lower at 0.93%. The China Govt 10yr is also down -2 bps at 2.70%. The NZ Govt 10 yr yield is also lower, down -4 bps at 0.63% although earlier the RBNZ fix was up +5 bps to 0.70%. The UST 10yr has slipped back to 0.66% today and down -3 bps..

NZ DOLLAR UP
The Kiwi dollar has held on to all of its sharp recent gains to be now up at 61.3 USc. Against the Aussie we are also marginally higher at 93.4 AUc. Against the euro we are firm at 55.9 euro cents. That means the TWI-5 is up at 67.1.

BITCOIN SOFT
The price of Bitcoin is lower by -2.9% at US$9,476. 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 ».