Here are the key things you need to know before you leave work today.
TODAY'S MORTGAGE RATE CHANGES
There have been no home loan rate changes again today.
TODAY'S DEPOSIT RATE CHANGES
It's all quiet on the term deposit front as well.
MONEY OR JOBS
It was announced that the adult minimum wage will increase by 50c from $14.25 to $14.75 an hour from 1 April, a +3.5% rise. The starting-out and training hourly minimum wages will increase by 40c to $11.80 an hour, being 80% of the adult minimum wage. Given that inflation is running at +0.8% pa this is an unusual increase. The activists who run the 'Living Wage' data set recently raised their standard by a lesser amount, from $18.80 to $19.25 an hour a 45c increase. The Government maintains that above $14.75 "would constrain employment growth by up to 5,000 jobs per year."
SKIMMING ALERT
Two Kiwibank ATM machines have been modified by criminals who have attached skimming devices that capture information from customers’ bank cards. The ATMs involved are located in Courtenay Place in Wellington and Marewa in Napier. Both machines have now been declared free from any devices and are back operating safely.
TACKLING EXCESS FOREIGN HOUSING DEMAND
The Australian federal government today announced plans to charge fees to foreign nationals buying residential property and fine those who break foreign investment laws, in an attempt to improve housing affordability amid some of the world's highest property prices. The scheme could raise about AU$200 million a year by charging foreign home-buyers AU$5,000 for properties valued under AU$1 million and an additional AU$10,000 for every additional AU$1 million.
DROUGHT RESPONSE
The widening drought in is behind a reminder by Federated Farmers to prepare feed budgets for livestock as the impact bites harder.
WHOLESALE RATES FALL
Following the lead from benchmark rates in New York earlier today, our swap rates are down -1 to -2 bps. The 90 day bank bill rate is also lower -1 bp to 3.62%.
NZ DOLLAR RISE
Check our real-time charts here. The fx markets have taken a quite different view to the bond markets over the Yellen congressional testimony earlier. The kiwi dollar has risen as the day progressed to 75.3 USc, fallen to 95.6 AUc , and the TWI is holding at 78.2.
You can now see an animation of this chart. Click on it, or click here.
Daily exchange rates
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2 Comments
TACKLING EXCESS FOREIGN HOUSING DEMAND
When the Aussies address an issue they are decisive and don't mess about. Good on them.
It means however that more foreign buyers will be directed to NZ.
Their scheme is very sensible because you can bet that foreign owners are paying no tax or contributing nothing to the running of the country, but are enjoying the benefits which the other tax payers fund. They are getting off pretty lightly at this stage because it could be fairly argued that the property should have a deemed earning income of the bank rate, say 4% or $40,000 per year. Taxed at the second top tax rate37%, say $14,800 per year for a $1 million house.
Bear in mind that all the States charge stamp-duty on the purchase (at the time of purchase) of any property be it residential or agricultural. It is a state tax and not a federal tax. A purchaser of a $1,000,000 property would pay approximately $75,000 stamp-duty up-front, going in.
A $1,000,000 property has a cash settlement cost of $1,075,000
In the current "climate" of robust property prices, for the past 5 years, the states are swimming in stamp-duty revenue, and are going gang-busters in developing new infrastrure projects ie hospitals, schools, roads, public transport, water and importantly, cash subsidies to industries who will employ people and re-locate to the state
In short, foreign investors and migrants into Australia pay a hefty sum in tax straight away
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