A review of things you need to know before you go home on Monday; sharp cuts in mortgage rates, housing markets tighten, FMA change, fat returns for linkers, sharp swap rate falls

A review of things you need to know before you go home on Monday; sharp cuts in mortgage rates, housing markets tighten, FMA change, fat returns for linkers, sharp swap rate falls

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

TODAY'S MORTGAGE RATE CHANGES
ASB / BankDirect / Sovereign all cut rates across the board and have a 4.69% fighting rate for a 'special' one year rate. TSB Bank has launched a two year 'special' at 4.79%. But neither comes close to the HSBC Premier rate of 4.49% which was launched on Friday. Today's sharp falls in wholesale rates may give some room for others to match these new low rates.

TODAY'S DEPOSIT RATE CHANGES
There have been no changes announced so far today.

HOUSING MARKET TIGHTENS
Inventories of unsold houses have been declining recently, down to 18.3 weeks on a national basis from 20 weeks worth in June.

FMA CHANGE
The head of the FMA's enforcement section has quit, looking for a "new challenge outside the FMA". Belinda Moffat is leaving after three and a half years leading the FMA’s enforcement team during which she was in charge of the finance company investigations.

CHINA FACTORIES STUMBLE
The final July factory data has signaled that the downturn in China’s manufacturing sector intensified at the start of the third quarter. Renewed falls in both total new work and new export orders led manufacturers to cut production at the fastest rate since November 2011.

LINKERS ARE CRACKERS
According to analysis by Standard & Poors, inflation-linked bonds in New Zealand were a "particular bright spot" for bond investors, gaining +3% on the month and moving into double-digit returns on a 12-month rolling basis, up to 10.39%.

WHOLESALE RATES DROP AGAIN
Swap rates fell sharply again today, down -3 bps or -4 bps across most terms. The 90 day bank bill rate is also down -4 bps at 3.06% and that is the sharpest one-day drop we have seen for a long time.

NZ DOLLAR UNCHANGED
Despite the interest rate falls the currency markets are virtually unchanged from this time on Friday. The NZ dollar is currently at 65.8 USc, also lower against the Aussie at 90.2 AUc, and at 60 euro cents. The TWI is still at 70.7. Check our real-time charts here.

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USD 
NZD
End of day UTC
Source: CoinDesk

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According to analysis by Standard & Poors, inflation-linked bonds in New Zealand were a "particular bright spot" for bond investors, gaining +3% on the month and moving into double-digit returns on a 12-month rolling basis, up to 10.39%.

I have noted before, ~70% of NZDMO coupon issuance is foreign owned - the NZD/USD CCY pair fell 25% over the same period - were linker winners hedged or is it a case of the remaining 30% with a minimum NZD one million tender bid profile booked the profit domestically?

John Lee: Numbers don't lie. You really just have to look at China's economic situation to realise that there aren't many good options for the Chinese leaders. In fact the best possible option really is to just grow very moderately, keep a handle on social unrest, and try to stabilise Chinese politics and Chinese society. But they are not really the ingredients for a dominant power in Asia.

Orville Schell: In many ways China has changed profoundly over the last century. I mean, we had a whole communist revolution after all, and then Deng Xiaoping came along, and we had a whole different kind of a counter-revolution. Now we have Xi Jinping coming along, and he has a whole set of new agenda himself. I think what is so surprising about China and stock markets are really one sort of aspect of this great welter of contradictions, and that is how much China has changed, and yet how much it hasn't. And whether this is a recrudescence of history, of traditional culture, of Leninist culture, Maoist culture, or what culture we don't know. But it's simply to say that we are looking at one of the great experiments, great social, political and economic experiments in modern history of a country that is trying and has been trying for a century now to reinvent itself.

read the full transcript here:
http://www.abc.net.au/radionational/programs/rearvision/china-stock-mark...

"Athens stock index plunged in its worst ever one-day performance after only a few minutes of trading.... The overall banking index was also down to its 30 per cent volatility limit ".