Here are the key things you need to know before you leave work today.
MORTGAGE RATE CHANGES
ANZ has reversed some, but not all of its rate hikes from ten days ago. More here.
TERM DEPOSIT RATE CHANGES
None here today, and that means ANZ has not reversed its TD rate rises..
HOME LOAN AFFORDABILITY TOUGHER
Based on the July 2021 update, home ownership is increasingly the preserve of those on above average incomes as high house prices and rising interest rates hit first home buyers hard.
OK FOR NOW
Finance minister Grant Robertson is confident the Government won't need to borrow more to pay for this lockdown - for now at least. More here.
HUGGINS GETS BNZ'S TOP JOB
BNZ makes an internal appointment of current senior executive Dan Huggins* to succeed Angela Mentis as CEO in October.
COMPARE BANKS HERE
The RBNZ released its update of data to June 2021 in its Dashboard. You can compare banks here.
WIND OUT OF ECONOMY'S SAILS
The fast-slowing electricity demand is being matched by a fast-falling wholesale price. In fact it has only been this low on one day in the past 480 (16 months).
WINDING DOWN FAST
In fact, New Zealand seems to be winding down and switching off. ANZ has been reviewing the 'high frequency data.'
ANZ FOLLOWS WESTPAC WITH LOCKDOWN 'SUPPORT'
ANZ has followed Westpac in announcing a set of four 'support measures' for their customers who may be struggling with this latest lockdown. They aren't waiving interest either.
THE MOBILITY DEFICIT
In July, a surge in imports (up +34%) overwhelmed a very good rise in exports (up +15%) resulting in a -$402 mln trade deficit for the month and taking the deficit for the past 12 months to -$1.1 bln. The July result was unexpected because in July 2020 we achieved a +$425 mln surplus, but in July 2019 it was a large -$732 mln deficit. Our July trade with China delivered a +$156 mln surplus and taking the 12-month total to a +4.6 bln surplus (and +25% more than the 2020 equivalent). With Australia, our July surplus shrunk to just +$30 mln. With the USA it fell to +$112 mln. With Japan we slipped into a trade deficit of -$36 mln for the month. The July result is all about importing cars and fuel.
STILL LOADING UP IN JULY
Prior to the lockdown, the July new lending data released by the RBNZ (C31) showed an increasing share of the mortgage activity was being generated by those already on the property ladder. First home buyer share dipped to 18.2%, and investor activity dipped to 16.7% and its lowest since these records began in 2014. Homeowners already in the game now supply 64.1% of all new mortgage action, its highest level since 2018. More here.
PANDEMIC PRESSURE STAYS INTENSE
There were another 919 new community cases in NSW today with another 741 not assigned to known clusters, so they are completely out of control. They now have 12,286 locally acquired cases all in their leaky pseudo lockdown. Victoria is reporting another 50 new cases today, so it is still bad there too and their lockdown is extended, also with a curfew. Queensland is now reporting six new cases with growing threats there. It has instituted a two week ban on interstate arrivals, throwing many things into confusion, including scheduled sports. ACT has 9 new cases. Overall in Australia, more than 31% of eligible Aussies are fully vaccinated, plus 23% have now had one shot so far. There was only 1 new case in New Zealand at the border, and 62 more in the community. So far, 24% of eligible Kiwis now have both shots, another 19% the initial shot.
GOLD SOFT
Compared to where we were this time yesterday, the gold price is down -US$7 at US$1801 in early Asian trade. But that is down -US$9 from the closing New York price and down -US$14 from the afternoon London fix.
EQUITIES PULL BACK
In New York, the S&P500 closed its Tuesday session up +0.2% and not able to extend the risk-on mood. At least it didn't retrace. Today, Tokyo is flat in morning trade after yesterday's strong gain. Hong Kong is down -0.6% and Shanghai down -0.1% in their early trade, taking the top off the prior days rises. The ASX200 is up +0.2 in afternoon trade, and the NZX50 Capital Index is up another +0.5% in another good local showing.
SWAP & BONDS RATES STAY QUIET
We don't have today's closing swap rates yet. They have probably jumped, especially at the one year term, up +6 bps, and the two year up +5 bps. We will update this when the end-of-day data comes through. The 90 day bank bill rate is up a sharp +7 bps at 0.46%. The Australian Govt ten year benchmark rate is up another +4 bps from this time yesterday at 1.17%. The China Govt ten year bond is weaker by -3 bps at 2.86%. But the New Zealand Govt ten year is up +3 bps at 1.65% and now below the earlier RBNZ fix of 1.69% (+11 bp). The US Govt ten year is now at 1.29% and up +2 bps from this time yesterday.
NZ DOLLAR STAYS FIRM
The Kiwi dollar is now at 69.4 USc, up another +50 bps from this time yesterday. Against the Aussie we are also firmer at 95.7 AUc. Against the euro we are firm too at 59.1 euro cents. The TWI-5 is now at 72.7 and back near the middle of the 72-74 range we have been in for ten months.
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BITCOIN SLIPS
The bitcoin price is now at US$48,209 and down another -1.9% from this time yesterday. Volatility in the past 24 hours has been moderate at +/- 2.3%.
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* For transparency, Dan Huggins is David Chaston's son-in-law.
15 Comments
More on the rotten corruption across the ditch. In charge of Treasurer Josh Frydenberg’s office is the same person running corporate affairs at Westpac’s BT when the superannuation giant was aggressively covering-up a major scandal involving it gouging billions of dollars from its members. it gets even more outrageous when the same person was flitting between roles with the Aussie govt and Westpac (and not rccorded on his public Linkedin profile). Everyone's refusing to speak including ASIC, which has been stacked with people from Westpac.
https://www.theklaxon.com.au/home/frydenberg-cos-a-westpac-boss
The lockdown in NSW is well described as leaky it is a complete sham I have family over there and they are able to travel and shop big W liquor stores tile shops hardware etc it is nothing like as tight as our lockdown. The premier is a disgrace unfortunately her financial incompetence as a treasurer has flowed through into her current position as a potential candidate for worst ever premier .
Light reading from the RBNZ today , discussing all their current tools and who is carrying the lunchbox. "RAMPed up"
https://www.rbnz.govt.nz/research-and-publications/reserve-bank-bulleti….
Looking at todays happy talk New Zealand thankfully has sufficient money trees to bail out any of their Australian banks, as mortgage debt/GDP looks set to pass thru 100 percent in the September quarter .Hopefully the RBNZ ramp is not a slippery one. .
They'd been peddling a narrative based on a massive falsehood; that economic growth could continue forever. They used it to excuse them and their voting-base, taking more than an equitable share with the excuse of 'trickle down'.
Their problems are two: There was no trickle-down (more a flood, up) and the growth period is in injury time. Nobody yet has a cogent narrative which fits the facts, but those adhering to the old one are way behind those peering ahead.
Dinosaurs. And we know what happened to them.....
the whole party has gone feral the lack of quality of MPs they are bringing in rivals the labour party , watching the health committee hearing this afternoon and the national MP for the north shore asked a question the poor brigadier only got out one word of her answer out before he shouted over her, very very angry and rude, you dont have to agree with someone but let them answer your question first.
I'm glad to hear that, although lockdowns don't yet appear to be having the desired impact on the Indian Delta varient, shutting down our economy is having some impact on the electricity market. Next year when we have seasonal supply shortages again we'll just shut down our economy.
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