A review of things you need to know before you go home on Friday; many rate cuts, factory jobs very weak, tax tidbits, rent spikes, swap rates flatten, NZD falls then holds, & more

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

MORTGAGE RATE CHANGES
China Construction Bank cut mortgage rates to near market lows.

TERM DEPOSIT RATE CHANGES
Westpac has cut TD rates for terms 5 months to 18 months. WBS and NBS both cut term deposit rates. Kiwibank cut its NoticeSaver rates.

IT'S VERY TOUGH ON THE FACTORY FLOOR
New Zealand's factory sector contracted sharply in May, just not as disastrously as in April. Still, the contraction was near record levels (if you ignore the April), pipped only by the depths of the GFC. One worrying sign is that despite the overall 'improvement' from April, and despite the Government's wage subsidy, the employment sub-index was worse in May than April.

'GOOD HARD LOOK AT TAX SETTINGS' SOME WAY OFF
Revenue Minister Stuart Nash says the Government at some point will have to "take a good hard look at all the tax settings." For now, however, the focus is on putting tax measures in place to allow businesses the best opportunity to move from survival into recovery. Speaking in a Chartered Accountants Australia and New Zealand Zoom call, Nash said "personally I'm not a fan of introducing a whole raft of new taxes. I think that would probably be counter productive to growth." Additionally he said no consideration had been given to reducing GST for a period, and Nash said he was reluctant to consider this because it's very non-targeted.

NOT CHASING $200
If you owe the IRD less than $200 in the 2019/20 income tax year, it will likely be written off by them and you won't have to pay it. The usual threshold for writing off tax is $50. They say that will reduce tax bills for approximately 149,000 taxpayers.

RENT SPIKES, UP IN AUCKLAND, DOWN IN THE SOUTH ISLAND
Median rents for an Auckland three bedroom house rose sharply to $695/week in Auckland, a new record high and up +6.9% in a year. But all the rest of the rental data out today recorded declines, especially in the South Island and especially in the Queenstown region. House rents in Wellington and Christchurch also fell in May. This data is all from MBIE's tenancy bond data. Nationally, rents are up +3.5% across all types.

AUSTRALIA UPDATE
In Australia, there have been 7287 cases (+2 since yesterday), 102 deaths (unchanged) and a recovery rate of just over 92% (unchanged). 18 people are in hospital there (-2 since yesterday) with 2 in ICU (11). There are now 424 active cases in Australia (-15).

GLOBAL UPDATE
The latest compilation of Covid-19 data is here. The global tally is now 7,500,800 and up another +143,000 from this time yesterday. This is still rising at a faster pace than recently. Brazil has just hit 800,000 infections, Russia 500,000 and the UK 300,000 but the UK still has recorded more deaths than both Brazil and Russia. American cases rose by +23,000 since yesterday to 2,022,500. US deaths now exceed 114,000. Global deaths now exceed 421,000.

EQUITY MARKET UPDATES
Wall Street ended lower with the S&P500 down -5.9% in today's session. That followed European markets that were down about -4.5%. Asian markets have all opened sharply lower, down at least -1%. Locally the ASX200 is down another -1.7% on top of yesterday's hard hit. The NZX50 Capital Index is down -2.0% in late trade after yesterday's -1% drop.

SWAP RATES UPDATE
Swap rates probably flattened today. We don't have wholesale swap rates movement details yet but we will update this later in the day if they show a significant movement. The 90-day bank bill rate is up another +1 bp to 0.27%. The Aussie Govt 10yr has retreated further today by -5 bps to 0.88%. The China Govt 10yr is down an unusually large -7 bps to 2.78%. And the NZ Govt 10yr yield has fallen by -5 bps to 0.81%. The UST 10yr is down -3 bps since this time yesterday at 0.69%.

NZ DOLLAR FALLS, BUT NOT AS MUCH AS YOU MIGHT HAVE EXPECTED
The Kiwi dollar has held its overnight level of 64.2 but that has embedded in the full overnight -1c fall. Perhaps it is encouraging that it hasn't fallen further in today's local session. Against the Aussie we are firmer at 94 AUc. Against the euro we are down -½c to 56.8 euro cents. The net off all that means the TWI-5 is down sharply to just on 69.

BITCOIN DROPS
The price of Bitcoin is sharply lower than this time yesterday, down -6.0% to US$9,336. 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 ».