A review of things you need to know before you go home on Thursday; many retail rate cuts, listings surge, more capital for insurers, more cheap NZGB yields, RBNZ surplus up, NZD firms, & more

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

MORTGAGE RATE CHANGES
ASB trimmed its four and five year fixed rates to 2.99%, matching BNZ and Westpac and leaving ANZ and Kiwibank as the only two majors with these rates above 3%.

TERM DEPOSIT RATE CHANGES
NBS and CU Baywide cut TD rates today. And so did ASB. ASB also cut its 'bonus saver' rates so that the best you can do now with this type of account is 0.15%.

NEW LISTINGS RUSH
New Realestate.co.nz residential property listings were up almost +13% year-on-year in September. Auckland listings were up +34% on the same basis. But inventories are still at their lowest relative levels since 2016.

INSURERS FACE HIGHER CAPITAL REQUIRMENTS
RBNZ has just re-launched its insurance industry capital review and it is to be based on principles similar to bank capital review. In this case 'conservative' means 'more'.

GENERATE INVESTS $15M IN SALVATION ARMY COMMUNITY HOUSING
The Generate KiwiSaver Scheme is making a $15 million investment to become a cornerstone investor in the Salvation Army Community Bond. This makes the fund an investor in 118 new homes for families without homes. The Community Bond is a fixed interest, five-year investment yielding 2.30% pa.

NZ FSG AND KEPA EYE MERGER
NZ Financial Services Group and Kepa plan to merge to create a national dealer group with more than 1,600 members that settles about $17 billion of mortgages annually and issues $30 million of life insurance premiums. The deal requires Overseas Investment Office and New Zealand Commerce Commission approval.

MORE VERY CHEAP FUNDING
Treasury tendered another $600 mln in Government bonds today and received bids for $2.23 bln, leaving $1.6 bln in unsatisfied demand. That is partly because this set of tranches was originally supposed to be $1 bln, but was cut back recently based on lower needs. The April 2023 bond was won by eight of 20 bidders with a negative interest rate of -0.01%, the April 2029 was won by 25 of 60 bidders at a positive 0.38% pa yield, and the April 2033 bond was won by 12 of 36 bidders at a yield of 0.68% pa. These final yields were all at about the expected levels, maybe +1 bps higher each.

RBNZ POSTS SURPLUS, WON'T PAY DIVIDEND
The Reserve Bank recorded a June year surplus of $371 million, an annual increase of $128 million, or 53%. However the central bank won't pay the government a dividend this year, it paid $195 million last year, instead retaining earnings to increase its capital buffer to $2.4 billion from $2.3 billion. Net operating expenses over the past five years exceeded the five-year government funding agreement total of $324.3 million by $2.4 million. This was attributed to $2.7 million overspending on currency in 2019-20 due to "extraordinarily high demand" for banknotes during the COVID-19 pandemic. Total assets grew $29.4 billion to $56.1 billion, with $22 billion due to the Large Scale Asset Purchase program.

A COMPARISON ...
It may not be a fair or proper comparison (because one is a regulator, the others trading banks), but the RBNZ's result compares with ANZ's profit of $1.5 bln on assets of $181 bln, ASB's profit of $958 mln on assets of $105 bln, BNZ's profit of $714 mln on assets of $114 bln, and Westpac's profit of $558 mln on assets of $103 bln each of the same comparable period.

ONLY A PARTIAL RECOVERY
In Australia, even though the number of job vacancies recovered in August from the awful May levels they are still -8% lower than the same month a year ago. And that means there are almost 23,000 less vacancies now.

THE ONLY OPTION
The iron ore price has risen +US$10 to US$123/tonne on the back of the the fast-recovering Chinese economy. And that is its highest level since 2013. Sadly for the Chinese (!) supply from Brazil is handicapped at present leaving them with few alternatives to punish Australia for its other foreign policy positions.

GOLD PRICE LITTLE-CHANGED
The price of gold is now at US$1888/oz in early Asian trading. That is a small +US$3 rise from the closing New York price which in turn was a fall from the final Lonon fix of US$1887/oz.

EQUITIES UPDATE
On Wall Street, the S&P500 ended their session up +0.8% but that is only about half the early afternoon gain of +1.7%. The ASX200 is up +1.5% in late morning trade but the NZX50 Capital Index is only up +0.5% in late afternoon trade. Shanghai and Hong Kong are closed for Autumn Festival/Golden Week. Tokyo is down -0.3% in early trade.

SWAP & BOND RATES RISE
We don’t have the final data for today yet and if it is significant we will update it here. The 90 day bank bill rate is dipped -2 bps today to 0.29%. The Australian Govt ten year benchmark rate is up another +3 bps at 0.89%. The China Govt ten year bond is up +2 bps at 3.16%. Meanwhile, the New Zealand Govt ten year is unchanged at 0.52% and matching the earlier RBNZ-recorded fix of 0.52% (+6 bps). And the NZGB five year is not negative anymore and is now at +0.03% pa (+5 bps). The US Govt ten year is up from this morning at 0.69%.

NZD FIRMER
The Kiwi dollar is firmer again this afternoon, now at 66.3 USc compared to this time yesterday. Against the Aussie we are unchanged at 92.5 AUc. Against the euro we are at little-changed at 56.5 euro cents. That all means our TWI-5 is at up 69.6.

BITCOIN UNCHANGED
Bitcoin is virtually unchanged today US$10,816 and may be for a while now that some big Asian markets are closed.

This soil moisture chart is animated here.

The easiest place to stay up with event risk today is by following our Economic Calendar here ».