What happened Monday

A review of things you need to know before you go home on Monday; mortgage rates drop, LGFA rating support, housing politics, jump in rentals, jump in swaps, NZD holds

20th Oct 14, 4:00pm by David Chaston

For Monday, October 20, 2014. <a href="http://www.shutterstock.com/">Image sourced from Shutterstock.com</a>

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

TODAY'S MORTGAGE RATE CHANGES
There were changes today with ASB/BankDirect/Sovereign cutting two key rates, and then Kiwibank (along with AMP Home Loans) trumped them with a new market-leading one year rate of 5.69%.

TODAY'S DEPOSIT RATE CHANGES
NZCU Auckland raised their one year TD rate from 4.50% to 4.75%, and their 18 month TD rate from 4.75% to 5.00%.

SOVEREIGN BACKING
Standard & Poor's said today that it had affirmed its 'AA+/A-1+' local currency ratings and 'AA/A-1+' foreign currency ratings on the LGFA. The outlook remains stable. They said these ratings are based on the "extremely high" likelihood that the New Zealand government will provide "extraordinary support in a stress scenario".

TODAY IN HOUSING POLITICS
The Government is starting its new term very focused on housing issues and housing affordability. Paula Bennett is attacking 'loopy rules', Bill English is remaking Housing New Zealand and boosting the social housing sector, and John Key has weighed in on how young people should get on the property ladder.

MORE RENTALS
Greg Ninness is reporting that official data shows there are 17,500 more houses being rented than at this time last year (a +3.8% rise). 45% of that increase was in Auckland.

WHOLESALE RATES
Domestic swap rates rose again today in another strong steepening bias, making back even more of last week's mid-week losses. These moves mirror Friday's Wall Street shifts as they shook off their anxieties and recovered their composure. We are almost back to where we were at the start of last week. The 90 day bank bill rate fell -1 bp to 3.67%.

OUR CURRENCY HOLDS
Check our real-time charts here. Today the Kiwi dollar held its own against the US dollar and is at 79.5 USc. Ditto Aussie to 90.5 AUc. The TWI sits at 77.

You can now see an animation of this chart. Click on it, or click here.

Daily exchange rates

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Source: RBNZ

Source: CoinDesk

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7 Comments

by Gummy Bear Hero | 20th Oct 14, 4:10pm 1413774613

... if only Auckland house prices would drop as quickly as a certain stock has plunged from $ 46 a few months back , to $ 16 today ... in another 2 weeks they'll be down to Xero , and giving them away ...

A salient lesson for all investors , this week's darling will eventually become a daggy dog to avoid ...

... not that XERO has done anything wrong , not in the least their problem that the market went on a bender and bid them to infinitey and beyond ...

by Stephen Hulme | 20th Oct 14, 9:05pm 1413792323

Shame on you for calling our attention to the upward pump leg a while back. The less than worldly might have got caught up in the euphoric sentiment you signalled at that time and might now be regretting the dump leg.

Not that I wish you ill, but maybe a silence similar to that which Hubbard now exercises over his past flock maybe appropriate where matters of investment are concerned.

by Gummy Bear Hero | 20th Oct 14, 10:17pm 1413796658

Facio quod ego potest salvare elil stultis erroribus !

by Kumbel | 21st Oct 14, 5:00am 1413820847

Facio quod ego possum salvare eos stultis erroribus

(Cicero whirls in his grave)

by Gummy Bear Hero | 21st Oct 14, 1:03pm 1413849827

Why would Cicero be whirling in his grave ....

... did he invest on the NZX ?

by waymad | 20th Oct 14, 4:22pm 1413775334

Note that soil moisture deficit in the Waitaki Valley. Was talking to a local in Duntroon last week, no rain of much consequence for a month now. Pumps and pivots going flat out on - er - the flats. 'Lectric power bills through the roof, prices having a wee dead-cat bounce. As goes Dairy, goes everything except, it seems, Awkland hoose prices.

by Kumbel | 20th Oct 14, 9:30pm 1413793812

No serious rain a bit further up the island since the June floods. Handy when the council is replacing an important bridge that fell to pieces under their feet.