Here are the key things you need to know before you leave work today.
NO RATE CHANGES TODAY
Surprisingly, there were no mortgage or term deposit rate changes today (or over the weekend). Still waiting on BNZ and Westpac as the big ones yet to pull the trigger. We also note that the cash-back offers are ramping up, so competitive pressure is alive and well in the mortgage market.
FARMS SELL BRISKLY
There were 146 (138) farms sold in February, six percent more than the same as for January. The February total was 32% higher than the same month a year ago. Interestingly, the median sale price per hectare was also unchanged from January with dairy units actually falling from a month earlier. Overall, dairy land prices are down for the third month in a row. Lifestyle block sales were up almost 10% from the same month a year ago.
FORECASTERS GET IT WRONG
Cyclone Lusi failed to deliver any meaningful moisture. See chart below. Maybe it is 'the media' rather than Metservice, but the shameless overhyping of the storm - which turned out to be just some high winds - undermines forecasting credibility. "If they can't get tomorrows weather right, why should we believe the next warning - or even why should we believe the climate forecasts." Major failures like this last weekend don't do anyone any good. And the growing dryness won't set up winter well unless decent rains come soon.
NZX TO LAUNCH A SMALL CAP MARKET
It is designed to provide small and mid-sized New Zealand businesses with an expected market cap of $10-100 million with an easier and lower cost alternative to accessing external capital. It also provides an opportunity for investors to access up-and-coming New Zealand businesses. Some of these businesses are in an earlier stage of development than many investors have previously had access to. Brian Gaynor was among those calling for this move.
NZIER SEES MORE GROWTH, MORE JOBS, HIGHER WAGES
The New Zealand economy will grow strongly over the next couple of years, according to the latest NZIER Consensus Forecasts. Economic growth will pick up from 2.9% in the March 2014 year to 3.6% the following year. Exports this year were depressed by the drought, but will grow strongly in future years. Dairy production has already recovered strongly from the 2013 summer drought. The labour market will improve. There will be more jobs, fewer unemployed and wages will grow. Inflation will pick up towards 2.5% over the next few years. Interest rates have already begun to increase and the 90 day rate will rise to 3.6% by 2015.
PSI UNCHANGED
The service sector took a breather in February, expanding at a slower rate than for January, according to the BNZ-BusinessNZ index. This contrasts with the steady growth by manufacturers.
HIGH CONSUMER CONFIDENCE
The Westpac-McDermott Miller quarterly consumer confidence survey is now at cycle highs, although not at record levels yet. This index basically confirms what we see in the monthly ANZ-RoyMorgan measure.
WHOLESALE RATES
Swap rates are showing rises today, probably on the back of the start of a rush to fix. They are up +3 to +5 bps for most terms. The 90 day bank bill rates was also up strongly today at 3.09%, the highest it has been in three years and markets are now clearly starting to price in an April 24 OCR rise.
OUR CURRENCY
The NZD is has held on to all of last week's gains and it is ending today at US85.4c and A94.6c and the TWI is at 79.7.
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