A review of things you need to know before you go home on Wednesday; ANZ cuts rates, dairy prices rise, farms sales strong, lifestyle block sales stronger, swaps hold, NZD soft, & more

A review of things you need to know before you go home on Wednesday; ANZ cuts rates, dairy prices rise, farms sales strong, lifestyle block sales stronger, swaps hold, NZD soft, & more
ID 22702269 © Daniaphoto | Dreamstime.com

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

MORTGAGE RATE CHANGES
ANZ cut their one year fixed rate to 2.29%, matching Westpac.

TERM DEPOSIT RATE CHANGES
ANZ cut -5 bps from all their TD rates 6 months to 2 years. They also cut their SeriousSaver account rate to just 0.25%. NZCU Auckland trimmed their TD rates.

CHINESE DEMAND RAISES DAIRY PRICES
Global dairy prices are lifting on the back of surging Chinese demand. At today's auction, they were up +4.8% in USD and +6.7% in NZD. That motivated Westpac to raise its farmgate milk price estimate to $7.50/kdMS for the current season. (They also raised their estimate for the 2021/2022 season as well.) Other analysts may be holding their forecasts, but they do point to "upside risks".

FARMS SELL, BUT AT LITTLE-CHANGED PRICES
REINZ reported that December farm sales rose to 202 units, the highest for a December since 2015 (239). Sales for Finishing units at 169 where especially strong, the highest for a December ever and the second highest for any month for this type. Sales of grazing units were also unusually strong.. Overall prices however remain tame and below the general levels prevailing in 2009.

LIFESTYLE BLOCK SALES & PRICES
More than +1829 additional lifestyle blocks were sold in calendar 2020 (8888) than 2019 (7059) and average prices were up +15%. December sales finished on a very strong note with 976 properties selling in the month, the best December on record. The market is so hot, the real estate agents themselves are posing the question as to whether this level of activity is sustainable.

MORE BONDS TENDERED
Kāinga Ora/Housing NZ had a bond tender today for $100 mln in two maturities - $50 mln 2026s and $50 mln 2030s - both existing lines. We don't have results yet but when they are available we will add them here.

JAIL & HOME DETENTION
A South Auckland husband and wife, who a judge says used a repeat pattern of tax evasion and used their children as puppets in their ongoing businesses, have been sentenced to prison and home detention respectively. Tamanini Muaiava and his wife Uputaua Muaiava were sentenced in the Papakura District Court this week on 65 charges each of evading or attempting to evade the assessment or payment of goods and services tax, and PAYE.

FMA WINS COMPLAINT AGAINST ADVISER
The Financial Advisers Disciplinary Committee has today published its decision regarding a case brought by the FMA. The case relates to alleged breaches of the Code of Professional Conduct for Authorised Financial Advisers. They found the advisor breached standards 12 and 15 of the Code, which respectively pertain to keeping information about personalised services for retail clients, and the requirement to have an adequate knowledge of Code, Act, and laws. The committee has granted interim name suppression in this case.

WARNING OF US "NEWS" VIRUS
The NZ Government is warning parents about online content their children may be seeing. "The Department of Internal Affairs and Netsafe are urging parents and caregivers to be mindful of the online content their tamariki may be consuming in the lead up to the inauguration of president-elect of the United States of America Joe Biden on 20 January (21 January NZ time). Following the recent coverage of violent events in the US, there are concerns young people may be exposed to an increased amount of harmful content online."

SMALL SLIP
In Australia, the latest review of consumer confidence sees a small pull-back but still maintaining its higher recovery level.

STEP CHANGE
Israeli company StoreDot has made the first battery for electric vehicles that can be charged in just five minutes, a step towards making refueling as fast as cars at a petrol station. The lithium-ion samples were produced by StoreDot’s strategic partner in China.

GOLD PRICE UNCHANGED
Gold is trading in Australia, and soon in Asian markets. So far today it is holding at US$1840 from the final trades at this time yesterday.

EQUITIES UPDATE
Wall Street ended its session earlier today with the S&P500 up +0.8%. The ASX200 in early afternoon trade is up +0.5% and the NZX50 Capital Index is up +0.4% in late trade. Tokyo is down -0.3% in early trade while Shanghai is up +0.3% at its opening. Kong Kong is up +0.4% in opening trade and building on yesterday's very big rise.

SWAP & BOND RATES HOLD
We don't have today's swap rate movements yet. They were little-changed yesterday. If there are material changes when the end-of-day swap rates are available today, we will update them here. The 90 day bank bill rate is unchanged at 0.29%. The Australian Govt ten year benchmark rate is up by +1 bp at 1.05%. The China Govt ten year bond is unchanged at 3.18%. The New Zealand Govt ten year is up +1 bp at just on 1.03% and above where the earlier RBNZ fix was, at 1.01% (unchanged). The US Govt ten year is down -2 bps at 1.09% and continuing the oscillating pattern over the past few days.

NZD SOFT
The Kiwi dollar is now at 71.2 USc, little changed from this time yesterday but with a soft tone. On the cross rates we are soft against the Aussie at 92.4 AUc. Against the euro we are also soft at 58.7 euro cents. That all means our TWI-5 is slightly lower at 72.6.

BITCOIN SOFT
The bitcoin price is now US$36,124 and that is -1.7% below the price at this time yesterday. In between volatility has been +/-3.1%.

This soil moisture chart is animated here.

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

Daily exchange rates

Select chart tabs »

The 'US$' chart will be drawn here.
Loading...
Daily benchmark rate
Source: RBNZ
The 'AU$' chart will be drawn here.
Loading...
Daily benchmark rate
Source: RBNZ
The 'TWI' chart will be drawn here.
Loading...
Daily benchmark rate
Source: RBNZ
The '¥en' chart will be drawn here.
Loading...
Daily benchmark rate
Source: RBNZ
The '¥uan' chart will be drawn here.
Loading...
Daily benchmark rate
Source: RBNZ
The '€uro' chart will be drawn here.
Loading...
Daily benchmark rate
Source: RBNZ
The 'GBP' chart will be drawn here.
Loading...
Daily benchmark rate
Source: RBNZ
The 'Bitcoin' chart will be drawn here.
Loading...
End of day UTC
Source: CoinDesk

We welcome your comments below. If you are not already registered, please register to comment.

Remember we welcome robust, respectful and insightful debate. We don't welcome abusive or defamatory comments and will de-register those repeatedly making such comments. Our current comment policy is here.

33 Comments

That's a very interesting explanation by IR;

https://media.ird.govt.nz/articles/auckland-couple-sentenced-for-repeate...

Reading between the lines, those South Auckland agricultural growers who repeatedly paid in cash for the labour services (and I'll bet also without being charged GST) should also be prosecuted. Hope they are looking into that. Where theft is concerned, the receiver of stolen goods is also charged. There would not be this type of repeat offender, if the businesses purchasing the services weren't playing along.

reread between the lines. the mention of invoices is a clue. They probably invoiced the customers for GST , but did not pay it to IRD. As far as the customers are concerned , if they pay a invoice with a gst number on it , it is not their obligation to investigate wether the company charging them is passing on the GST. Indeed it is vritually impossible for them to do so .

Thing is, if paying cash on receipt of an invoice - the likelihood is the invoice itself has been doctored as well. In other words, the service charge for the labour is extremely low - 15% lower than one might expect, I suspect. The cash economy is likely a lot bigger than many would imagine.

Could be , but they could also be charging the customer full price plus Gst , and not declaring it . The customer has no way of knowing.

Lot of assumptions in both of your posts Kate. As mentioned by the article the IRD went back through the Invoices. It's entirely possible (if not probable) the growers were asked to pay in cash. Paying cash does not, of itself, insinuate a lower cost. It's also not illegal nor does it indicate wrongdoing on behalf of the client

Oh yes, highly likely they were asked to pay in cash. And they should have asked themselves, why (if not actually disclosed as to why). And then refused; therefore avoiding aiding and abetting this type of cash economy tax fraud.

In the grand scheme of things, it's pennies compared to the "charities" that don't pay any tax at all *cough* Sanitarium

Work on amending that Act was delayed mid year last year. But at least it has begun;

https://www.dia.govt.nz/charitiesact

Those that do cashies see nothing wrong with it, its one of the perks... right hook? ... unintended pun lol

In other crypto news, Ethereum finally breached its 2017 all time high today to set a new price of $1440(ish) USD, although it is still well down from its ATH in BTC terms, ~69%.

I bet you won’t hear Trumps farewell speech on the 6pm news. http://www.ktvu.com/video/891568
You have to feel for the USA, which in all likelihood has been lost forever.

If you believe that, you will believe anything.

David, what I was meaning is it being lost to the socialists.

American Democrats "socialism" is probably equal to ACT policies here. National at least .

Somewhere between Nats and Labour (very little difference between THEM now!)

As opposed to what before .....??

Thanks for the link - it is always best to watch these things in full, as opposed to in sound-bite.

Even the main Foxnews website has relegated his speech to the 6th line , and carries more articles on Republicans denouncing Trump. He is history, apart from impeachment and criminal trials.

He is history, apart from impeachment and criminal trials.

"Insurrection" - a sad legacy for US democracy that demanded the world find it exceptional to the point of being indispensable.

Without Democracy in the U.S., Can the Simulacra of Democracy Survive Elsewhere?

Too many big words.

I guess Greats wasn't on your bucket list.

Looks about right.

This prop is being overturned by the ‘Blue State’ precisely in order to savour a sweet revenge on Trump for pulling aside the mask on so much else of ‘Establishment America’. Trump laid bare how corrupt the ‘swamp’ had become, and he articulated Red America’s deepest concerns and frustrations about off-shored jobs, economic precarity and ‘forever wars’. They, in turn, had projected their exasperation, bitterness, and illusions back onto him, turning him, by default, into their standard-bearer.

Yet – astonishingly – this toppling of the pillar of an engineered ‘noble lie’ is being done precisely by those (the Establishment), who one might have thought, had the most interest in keeping it intact. But they cannot resist it. They just cannot forgive ‘outsider’ Trump’s intrusion into their neatly constructed illusions: trashing their elaborate ‘construct’ of reality, simply by magicking up new ‘facts’ to contest their ‘science’.

Great link. And another link within that article that is a really good read is this;

https://www.economist.com/open-future/2019/02/14/liberalisms-betrayal-of...

I also read the imbedded link to the Zerohedge, TIP 'war games' article with interest. Here's wiki on that organisation;
https://en.wikipedia.org/wiki/Transition_Integrity_Project

It's actually pretty good, other than the "I am the best" rants (I am the first outside president, we built a great political movement, we built the best economy, etc etc)... he wishes the new administration well, says he condemns the violence at the Capitol and in the first 5 minutes FINALLY sounds presidential. He really thinks he did an amazing job with the economy, but really he just continued the momentum from Obama, including more and more money printing. He seems to forget they are running a trillion dollar deficit... don't worry, the Republicans will suddenly remember they should be balancing the books the first day Biden steps into the Whitehouse.

SeriousSaver = 0.25% ... they are taking the mickey right?

Yep. It will take a $4,000,000 deposit to save $10,000 per annum. More, on an after tax basis.

Lotto is the only saviour for most, but a state sponsored gambling habit is hardly a lifestyle choice for most.

Yeah, how on earth did it come to this?

Means transaction account.

I get zero percent return on my transaction account at ANZ.

SS account? Maybe it needs renaming as the FS ( Frivolous Saver ) Account.

Or “what are savings?” Account

BNZ haven't officially cut their rate, but they gave it to me anyway. 2.29% fixed 1 year. And an unexpected $2500 cashback.

Watching US elections is important for our children given the path New Zealand society is on in regards to inequality, polarisation of politics etc. The New Zealand they live in might be very different to the one we enjoyed.