A review of things you need to know before you go home on Friday; nor retail rate changes, residential consents and building has momentum, milk payout raised, car sales sag, swaps hold, NZD softens, & more

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

MORTGAGE RATE CHANGES
There are no changes to report today.

TERM DEPOSIT RATE CHANGES
None here either.

RESIDENTIAL BUILDING BOUNCES BACK
New residential building activity running ahead of this time last year, commercial building work still lower.

STRONG HOUSING AND NO DEFERRALS NOW
Credit bureau Equifax says 96% of all accounts previously in mortgage deferral are now up to date

GETTING A STRIPPED-DOWN STRATEGY TO PAY OFF
Fonterra has raised its 2020/2021 milk payout forecast to a mid-point of $7.00/kgMS which is a +20c rise. It also said its earnings are rising on a strong recovery in China's foodservice sector. However it didn't say its dividend is about to rise. Fonterra's share price has been rising, but it only added another +3c today but is down to $4.36/share from $4.60 at the end of October.

RISING YIELDS, STRONG DEMAND, FEW WINNERS
Thursday, Treasury tendered $650 mln in four separate durations and was offered more than $2.2 bln. All ended with higher yields. The May 2024 $250 mln bond attracted $877 mln, and the nine successful bidders will be paid a yield of +0.28% pa, up from the prior 0.22%. The May 2031 $250 mln bond attracted $942 in bids and yields the eight successful bidders (of 37) a 0.91% return which is up from the prior 0.84% pa. The May 2041 $100 bln offer attracted $306 mln and a yield of 1.66% (up from 1.99%) to be paid to 7 successful bidders of 47. The last tender was for inflation-indexed bonds where $50 mln was available. $94 mln was bid and the yield was virtually zero plus CPI. There were 19 successful bidders here of 31 who applied.

RECORD HIGH CONSENTS
No sign of any slowdown in residential construction as new dwelling consents hit a 46 year high.

SAGGING CAR MARKET I
There were 8036 new cars sold in November, 75% of them SUVs. This total was -16% lower than for the same month a year ago, and this decline builds on prior months so that for the past twelve months, the total is back down to levels we last had almost six years ago.

SAGGING CAR MARKET II
Meanwhile the volume of used imports has fallen similarly and the annual level is back to August 2014 after being -18% lower in November that the same month a year ago. Don't discount supply chain issues as being one cause volumes are down sharply. It's possible.

UNDERMINED BY THE NZD
The ANZ World Commodity Price Index posted a modest gain of +0.9% in November. Higher prices for aluminium, beef, wool and butter helped push the index higher. In local currency terms the index fell -2.3%, as the NZD rose strongly.

LOCAL DYSFUNCTION
The Government has told the Tauranga City Council it intends to appoint a Commission in response to significant governance problems among the Council’s elected councillors, and the findings of an independent review.

'WE NEED A STATUTORY CLASS ACTIONS REGIME'
The Law Commission has released an issues paper looking at whether New Zealand should have class actions and commercial litigation funding. NZ doesn't currently have a class actions regime. Instead, claims that might be brought as class actions in other countries, such as the recent case brought by a Mr and Mrs Ross against Southern Response, are brought under the “representative actions rule” dating from 1882. Law Commission President Amokura Kawharu's preliminary view is that NZ needs a statutory class actions regime.

HOUSEHOLD NET WORTH HOLDS, DISTORTION GROWS
New data as at the end of September shows that the net financial new worth of New Zealand households marked time from June, and was only up +2.1% in a year. That "financial" net work is now $917 bln. This measure includes all mortgage liabilities but does not include any housing or land 'values'. So it is the most conservative of assessments. As at the same date there were 1,778,200 households, so that means each has a "financial net worth" on average of $516,000. That most don't is just an indication of how distorted the distribution is - a few have a lot more than that, most have a lot less. (That land and building value update won't come for another two weeks yet. But in any case it will be for September, before the recent aggressive run-up in house prices really took hold.)

CREDIT CARD INFORMATION NOW SHAREABLE VIA PAYMENTS NZ APIS
Payments NZ says it has released a new version of its application programming interface (API) standards. The new release updates the account information standard enabling customers who chose to share bank account balances and transaction histories with third party services, now including credit card account information. The API standards are a key building block in open banking.

DEEP DECLINE
In the US, falling demand for coal during the pandemic continues to take a heavy financial toll on the industry, tipping two more coal production companies into bankruptcy. They are White Stallion Energy and Lighthouse Resources and join a growing list. The American electricity sector consumed -28% less coal in the first half of 2020 than during the same period last year, only half of what they used five years ago. (US electricity produced only fell -1.3% from the same period a year ago.)

GOLD PRICE RECOVERS
The price of gold has fallen -US$2 in early Asian trade today from the closing New York price. And that New York price was +US$8 above the closing London fix last night. That live Asian price is now US$1839/oz.

EQUITIES UPDATE
The S&P500 ended its Wall Street session virtually unchanged today. The NZX50 Capital Index is heading for a daily no-change here too, and that will cap a week of very little net change as well. The ASX200 is up +0.4% in early afternoon trade and heading for a weekly gain of just +0.6%. Tokyo has opened today down -0.2%, and Shanghai has opened similarly. Hong Kong has opened up +0.3%.

SWAP & BOND RATES HOLD OR SLIP
Thursday swap rates held across the curve. If there are material changes today when the end-of-day swap rates are available, we will update them here. The 90 day bank bill rate is unchanged today at 0.25%. There is a bond selloff going on at the moment with consequent rises in benchmark rates. The Australian Govt ten year benchmark rate is up +1 bps at 1.00%. The China Govt ten year bond is up +1 bp at 3.33%. But the New Zealand Govt ten year is down -6 bps at 0.91% and still marginally above the earlier RBNZ-recorded fix of 0.89% (-3 bps). And the US Govt ten year has moved down -4 bps to 0.91%.

NZD MOVES LOWER
Against the US Dollar, the Kiwi dollar is now at 70.7 USc after being higher earlier, but back to where it was two days ago. On the cross rates it is down against the Aussie to 95.1 AUc and against the euro we are also softer at 58.2 euro cents. That all means our TWI-5 has moved down to 72.6.

BITCOIN HOLDS
Bitcoin is now at US$19,398 and virtually unchanged from the price we reported this morning. The bitcoin rate is charted in the exchange rate 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 ».