Here are the key things you need to know before you leave work today.
MORTGAGE RATE CHANGES
ICBC has cut both its fixed rates and its floating rate, which is down -30 bps to 3.69% (but that is still higher than Kiwibank's 3.40%). Co-operative Bank also cut fixed rates today, following the main banks down.
TERM DEPOSIT RATE CHANGES
Bank of China cut TD rates. And the Co-operative Bank cut rates for terms 3-15 months.
A SMALL SLIP AFTER A BIG GAIN
Dairy prices slipped -0.7% at today's auction (and were down more in NZ dollars) but that was almost all due to an almost -5% fall in the butter price. For the much more important WMP price, it was up +0.6% and that helps cement in the +8.3% gain recorded at the previous auction, so that farm gate milk price forecasts are under no threat from today's minor slip.
BRYERS CHARGED IN AUSTRALIA
Former head of collapsed Blue Chip Group, Mark Bryers, has been charged with fraud in Australia reportedly after providing "tax structuring advice", and has had his assets seized. He is accused of having a central role in an organised crime operation involving complex fraud. Bryers was never charged in New Zealand for his Blue Chip activities which lost investors more than $2 mln in 2008.
MONEY REMITTERS HIT WITH LARGE AML/CFT PENALTY
In Auckland, the High Court has issued a $7.5 mln judgment in civil proceedings against Auckland based money remitter OTT Trading Group and Christchurch based money remitter, MSI Group. Both were accused of sanitising drug money. OTT is solely owned by Tonghui QI, and MSI is solely owned by Ye Duan.
FLOOD RECOVERY ASSISTANCE
ANZ has announced an assistance package to help farms and other businesses in Northland and the Coromandel manage the aftermath of recent severe flooding. Relief options include suspending loan principal repayments, waiving fees associated with restructuring business loans considered necessary due to impacts of extreme weather, waiving fees for term finance and investments to help get operations back into production, options around early access to term deposit funds; and providing access to discounted short-term funding to help farmers get through the immediate challenges while also protecting their long-term productivity. These options are almost a carbon-copy of the bank's drought assistance for Northland farmers announced in February.
PRIVACY COMMISSIONER CAUTIOUS ABOUT COVIDCARD
Privacy Commissioner John Edwards says the CovidCard proposal involving Rob Fyfe and Sam Morgan needs further careful consideration before a decision is made to adopt it as a contact tracing solution for Covid-19. Edwards says any rush to market in the short term would lock New Zealanders into a proposed solution which could in the medium to long term prove ineffective and expensive. He says there are many unanswered questions as to how the proposal would work, saying many New Zealanders would be uncomfortable having to carry a mandated piece of hardware that records all their contacts for the Government.
M.BOVIS UPDATE
The Government is claiming that New Zealand’s "world-first effort" to eradicate the cattle disease Mycoplasma bovis has made significant progress with the number of infected properties dropping to just four now, after 250 properties were infected in total over the past three years. 69 of these farms were in the North Island, 181 in the South Island. So far 157,854 animals have been culled in the eradication effort and $166 mln in compensation paid (averaging $1052 per culled animal).
BRISCOES TRADING BETTER
The bellwether retailer has advised that "unexpected strength of the sales rebound experienced since the end of lockdown together with cost saving measures implemented by the Company as a result of COVID-19, have positively impacted the business. While it remains unlikely that the Group will achieve last year’s half-year sales and profit, we now expect the first half results to be closer to last year than indicated in our previous announcement."
REBOUND BEFORE ANOTHER FALL
Australian retail sales were up +2.4% in June from May, and rose +8.2% when compared to June 2019. This is better than anticipated and was led by cafes, restaurants and takeaway food services, and clothing, footwear and personal accessory. But this may all come unstuck in July with the growing crisis in Victoria (+484 new cases there today) and the spreading of infections to regional NSW. New restrictions loom for Sydney and NSW.
EQUITY UPDATES
The S&P500 lost some heart in late trading today, closing up less than +0.2% after earlier being up +0.8%. Shanghai has opened a strong +1.0%. But Hong Kong is up much more modestly (+0.3%) while Tokyo has slipped (-0.2%) at their open. Locally, the ASX200 is down -1.1% in early afternoon trade, spooked by the spreading second virus wave in Australia. The NZX50 Capital Index is up +0.2% in late trade.
SWAP RATES UPDATE
Swap rates were probably lower and flatter as the long end sank today. We don't have final 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 +1 bp at 0.31%. The Aussie Govt 10yr is up +1 bp to 0.88%. The China Govt 10yr is up by +2 bps to 2.97%. The NZ Govt 10yr yield is also down another -4 bps at 0.83%. The UST 10yr is now under 0.61%.
NZ DOLLAR FIRMS AGAIN
The Kiwi dollar rose sharply last night and has held on to most of that so it is now at 66.5 USc and almost another +¾c rise since this time yesterday making the gain so far this week as +1½c. Against the Aussie we are -½c lower in a day at 93.2 AUc. Against the euro we are marginally firmer at 57.6 euro cents. And that means the TWI-5 is now just over 70.3.
BITCOIN FIRM
The price of bitcoin is a little higher today at US$9,376 and a +2% gain. 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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93 Comments
I'd rather have Keith Woodford's take on the M.Bovis situation, than believe the Gubmint PR machine high-rpm Spin. Perhaps you could rattle his chain?
And looking at the Soil Moistness Maps, I'm irresistibly reminded of Sir Geoffrey Palmer's bon mot - "New Zealand is an Irreducibly Pluvial Country"....
Waymad
I am more optimistic than I was but there is still a long road to travel.
MPI's bovis operations have become much more efficient since April 2019, but still with room for improvement. Before that they were a shambles.
Also, the ELISA bulk-milk test is helping considerably - much better than the previous PCR test.
But just as with COVID, and as the Victorians have found out, it only takes one super-spreader event to quickly change the situation.
The most likely super-spreading event would be if a service-bull supplier became infected - some of them supply bulls to upwards of 100 farms.
KeithW
Gold futures are breaking out. Hit USD1,865 not long ago. On the silver front, commercial banks have been accumulating for almost exactly 6 years (while JPM has been ensuring they get it on the cheap). Now if they've been accumulating for these 6 long years, would it make sense to dump it in the $20 price range? Intuitively, that wouldn't make sense and we might not see these prices for silver for a very long time.
The UST 10yr is now under 0.61%.
More possible inflation fear mongering nonsense from Bloomberg - Japan 20-Year Bond Sale Meets Demand, Allays Steepening Concerns
The Japanese 20 yr trades at 40 bps, the two - twenty spread is ~54 bps.
Yes, NZ and AUD appreciation nullifies gains in gold and silver. Mind you, I'm exposed to the silver price through ETPMAG on the ASX. Managed 7.8% today. Silver Mines Ltd in Aussie up 20% today.
Doesn't necessarily represent economic meltdown. Remember, in 08-09, the Fed added $1.2 trillion to their balance sheet in 4 months and silver shot up 440% before QE enabled JPM to destroy the price. Now, the Fed has added $2.85 trillion to their balance sheet in 4 months. The mind boggles as to what might happen.
My daughter in California tells me the unemployment is getting scary, lots of middle class people finding themselves on the scrapheap.
Of course if you work for the State you don't have to worry, gold plated pensions and healthcare, 1st world salaries. That's why there had to be a crisis, those cities were going broke any which way you looked at it.
Our internet if a bit touch and go, not enough sun for the solar panels to keep the batteries charged. I've been getting 5-10mm a day for a few weeks now, I noticed the cattle have stopped putting on weight, they have lots of grass but it's gutless,wet ,slushy stuff. In 6 weeks it's spring, just have to tough it out.
Struggling at bit with the drought initiatives, I got a 'care package', gave it to someone who needed it. Hell ,wages around here are low, in HB median wage is 60k, many around here working for councils etc are on minimum wage while paying 20k a year in rent. Farmers with multi million dollar properties have had a knock , been a shit of a season, but we still have it so good. Watching Tv and seeing farmers I know taking free hay, when sitting on some seriously expensive real estate, while they drive 130k tractors and new Hilux in the shed, kids at private schools etc, just doesn't feel right.
I know it's been tough but it's been tough on so many businesses and I just don't think this is right. Entitlement is an interesting emotion, when there really are poor people amongst our communities.
Got fuel in town yesterday, a young mum pulled up to the next pump and put $10 in her car, i told her to fill it up and I would deal with it, she wouldn't accept it.
Lots of jobs around here have gone to Island workers on wages locals cannot live on with family. Immigration just adds more people to the bottom of the pyramid so the rich can keep skimming off the top. Really bugs me, Gov't are a daft bunch of idiots.
Sex scandal, inappropriate images to young women, trips for party mates to Antarctica at tax payers' expense, claims regarding leaker of unfounded superannuation application and payments, claims of "disgraceful, sleazy, innuendo-fuelled speech", Seymour thrown out of the house . . . .
Who said politics were boring? Certainly with not less than 2 months out from an election and some very worried.
@printer8 ............ the House is much like something from LORD OF THE FLIES right now , for those of us who read for at least one English Lit paper in our lives , either at school or uni , would realize .
Chaos , dissent , arguing , and fighting , groupthink vs individuality , morality vs immorality , raw survival , dog eat dog stuff, finger pointing , lies and deception .
In the middle of a crisis, to boot
Far too bleak when compared to the real thing.
https://www.theguardian.com/books/2020/may/09/the-real-lord-of-the-flie…
In the States the processors are keeping a wave of cattle ahead of them deliberately, they are getting top dollar in the market while paying low prices to farmers. Also weights are up a lot due to cattle hanging around on feed.
Don't know how it will affect us. I was in the States 7 years ago, cows with calves at foot (pairs) were getting nearly 3k, a year later you were lucky to get 1k. Our market didn't even notice. Good ol China aye. ( attempt at Canadian)
China is running into big flooding problems, suspect they will need a lot of food to fill the hole.
Had lunch with some really positive people today , and just got back ( 5pm)
Now just to be clear , all present were Boomers , either successful business people or professionals , one former All Black now farming in the Waikato , and one a director of a listed Company .
Now I dont know whether it was the beer and wine that helped , but they all reckon we are fine , we are the lucky country , things are back to normal and we will be fine . All agree we dodged a bullet here compared to Aussie or the UK
I did not want to disagree , or rain on anyone's parade , so I just nodded politely , and laughed where appropriate
They are mostly leaning towards voting for ACT , which I find odd . The consensus is that Labour will beat National , Peters is a gonner , Its will be a Labour / Green Government ( God help us ) on a paper-thin majority
I hope this upbeat sentiment is real and not an illusion , although to be fair , I noticed the Company director was cautiously optimistic , reticent I would say , rather than exuberant tone of the rest of those present , he was careful and measured in what he said.
An interesting afternoon
@Frazz ........I kept quiet, held my peace , did not say my piece , simply because I was enjoying the views of people who really believe we have reason to be upbeat .
I did ask some pointed questions though .
I just wish that they are right, and things turn out okay
Now just to be clear , all present were Boomers , either successful business people or professionals , one former All Black now farming in the Waikato , and one a director of a listed Company
Have NZ boomer colleagues like this on Linkedin. To be honest, they post some intereesting stuff, but I can see that most people who comment on their posts say some really vapid things. Very little to expand on or challenge ideas. Lots of glass half-full stuff. I think some of the CEO / senior management consulting types in NZ are out of touch with reality.
Oh dear;
Johns says $45 million has been spent on the project so far – which includes purchasing the land bordered by State Highway 8 and 8A...
Dividend money that could have been returned to Chch ratepayers; or did they borrow to purchase? Whatever it's nuts.
https://www.odt.co.nz/regions/central-otago/new-airport-mooted-central-…
ICYMI/FWIW: Kiwibank customers threatened with account closure after error. "I think that the way they are writing to me shows that they just want it to go away. And they're hoping that I am just busy and I just go 'okay fine, okay that's done'." https://www.newshub.co.nz/home/money/2020/07/kiwibank-customers-threate…
Pompeo banging the drum about China controlling the messages from the WHO re Covid.
https://www.dailymail.co.uk/news/article-8546961/British-coronavirus-vi…
ETPMAG off the ASX is one option - I put part of my portfolio into it about 12 months ago.
Search silver dealer. I use NZ Mint. Click on and see what you like. Add to cart, pay and it arrives.
You could call them and do it on the phone.
Best value is 1 kg and bigger. Arround $1200 at the moment.
Now I have the email contact. It goes like this.
Gidday Mitch, crazy times.
Price for your cheapest 1 kg block of silver and wait time please.
Cheers
He tells me.
I ask for a quote for 5 kgs.
He sends it to me. I accept and put the money in. It arrives.
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