A review of things you need to know before you go home on Thursday; insolvency cliff looming, where there are good yields, weak car sales, paid jobs growing, NZD firms again, & more

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

MORTGAGE RATE CHANGES
No changes to report again today.

TERM DEPOSIT RATE CHANGES
Update: ANZ has cut its term deposit offers hard, reducing most rates by -10 or -15 bps but one as much as -20 bps. It is nearly down to the recent ASB and BNZ levels.

INSOLVENCY CLIFF LOOMING ...
Chartered accountants say Government Covid support measures have had unintended consequence of propping up businesses that would have failed in normal times.

... BUT NO STRESS SHOWS YET
The latest insolvency data supports the idea that insolvency numbers are still very low. In July there were only 63 personal bankruptcies, and 87 No Asset Procedures. As a proportion of the population 20 years and over, that is a record low. It is a level that has been trending down since 2016. We are watching for the expected upturn.

WHERE BETTER (GROSS) YIELDS ARE
Bayleys' latest commercial property sales provided investors with net yields ranging from 4.41% to 9.05%. There was plenty of fare for smaller investors with prices starting at just $520,000.

WEAK CAR SALES
Sales of both new and used imports suffered in August as the Auckland lockdown took its toll. But that didn't affect sales of new energy vehicles (NEVs), which now account for nearly 17% of all new car sales.

MINOR PRESSUE
The ANZ World Commodity Price Index eased just -0.9% in August as lower dairy prices were partially offset by stronger prices for meat and aluminium. In local currency terms the index fell just -0.2% as the NZD weakened by -1.3% on a TWI basis during the month.

A MINOR YIELD RISE
Treasury's debt management office tendered $950 mln of bonds today in three tranches. They were offered almost $2.4 bln. The April 2023 bond was won at an average of 0.08% yield, and as low as that was, is up from 0.06% in the previous tender for this maturity. The April 2029 tranche was won at a yield of 0.48% (0.48% last time as well). And the April 2033 tranche was won at 0.82% (up from 0.75% last time.

RICH DIVERSITY
Statistics NZ released ethnicity data from the 2018 census today showing a rich diversity makes up our population. At the census date there were 160 different ethnicities in New Zealand (with at least 100+ people). Interestingly, Europeans made up 67.6% of the population in 2006, and that rose to 74.0% in 2013, but fell back to 70.6% in 2018. Mäori share rose through these three censuses from 14.6% to 14.9% then to 16.5%. For Pacific people, the rise was from 6.9% to 7.4% to 8.1%. For Asians generally, the rise is from 9.2% to 11.8% to 15.1%.

NOT GETTING WORSE
For the first time since May, our hydro lake levels have stopped falling. But they remain unusually low for this time of year.

PAID JOBS GROWING AGAIN
For the week ended August 2, 2020 the numbers of paid jobs (compared with the previous week) were up +0.66% from the prior week, a gain of +14,430 paid jobs. +1410 of that increase were in the primary industries, only +370 were in manufacturing, and the bulk, +11,570 were in the service sector.

SMALLER SURPLUS
In Australia, their July trade surplus narrowed a bit more than expected. Exports fell (-4.4%) and imports rose (+6.9%). Their service exports took a sizable step lower, down -12%. Their July surplus was +AU$5.4 bln.

MORE NORMAL NOW
China's private sector PMI for services was out today and it came in marginally lower in August than for July, expanding at a PMI of 54.1, as normal business conditions return to China. A feature of this report is the shift of the employment component into expansionary territory. Also this services PMI version is now slightly weaker than the official version (55.2) and that hasn't been the case for all of 2020.

EQUITY UPDATES
The S&P500 ended its session earlier today up a strong +1.5%. Shanghai has opened down -0.4%, Hong Kong is down -0.5%, but Tokyo is up again, also up a strong +1.4% so far in early trade. The ASX200 is up another +0.9% in early afternoon trade. And the NZX50 Capital Index is up +0.8% near its close.

SWAP RATES UPDATE
Swap rates details are not yet available yet. If there are notable changes again today, we will update this item. The 90-day bank bill rate is unchanged at 0.30%. The Aussie Govt 10yr is down -3 bps at 0.92%. The China Govt 10yr is up +5 bps at 3.12%. But the NZ Govt 10yr yield is back up by+3 bps to 062%. The UST 10yr has retreated from yesterday's close again, down -2 bps to 0.66%.

NZ DOLLAR FIRMS AGAIN
The Kiwi dollar is slightly softer than this time yesterday, now at 67.6 USc. But against the Aussie we are higher again at 92.4 AUc. Against the euro we are up to 57.2 euro cents. That all means our TWI-5 has risen slightly to 70.5.

BITCOIN SOFT
The price of bitcoin is down -2.3% at US$11,380. 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 ».