What happened Friday

A review of things you need to know before you go home on Friday; ASB cuts savings & TD rates, REAA wins another, 10,000 coming, China's finco crackdown, swap rates ease

22nd Apr 16, 4:00pm by David Chaston

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

TODAY'S MORTGAGE RATE CHANGES
No changes to report today.

TODAY'S DEPOSIT RATE CHANGES
The ASB has jumped the gun on next week's OCR review. It has cut their savings account rates again, basically taking -15 bps off already very very low rates. They also took -5 to -10 bps off their term deposit rates for terms from two to five years. The local branch of the Bank of India also cut most of its term deposit carded rates.

FIT & PROPER
The real estate industry regulator won its position in the NZ courts that has the right to check agents wider criminal background and not just formal 'convictions' as part of its assessment of 'a fit and proper personal to hold a license'.

COMING SOON
Next week we will get some big data. On Wednesday we get the March trade balance, Thursday both the US Fed rate review and the RBNZ OCR review. And on Friday the big dump of end-of-month data comes with the latest building consent data along with all the March private sector debt data. Most of next week's data and policy positions have the possibility to move markets.

IMPROVING CHINA?
The assessment of business conditions among executives at China’s largest companies nudged back over the break-even 50 line in April, as gains in new orders and output drove confidence higher and into expansion territory, according to the latest MNI China Business Sentiment Survey.

10,000 COMING
Each year, Amway China rewards its top sales people with an all-expenses paid international trip as part of the company’s sales incentive scheme. Thanks to a competitive business bid led by Tourism New Zealand, about 10,000 of Amway China's top sales people will enjoy five days of New Zealand’s famous tourism experiences and hospitality in Queenstown. They will arrive in groups of 500 during the shoulder and off-peak tourism season, and will be spread over four months in autumn 2018. In the year to March we welcomed almost 3.6 mln visitors, 378,000 from China. So this extra 10,000 is a boost of +2.6% from that country, +0.3% overall. Still, it is a notable 'win'.

FINANCE COMPANY CRACKDOWN
China is in the middle of a 'finance company' crisis with scandals aplenty. Today they made it much harder to register a new one.

WHOLESALE RATES INCH BACK
Wholesale swap rates fell today across the whole curve by just -1 bp except for the 10yr term. NZ swap rates are here. The 90-day bank bill rate rose +1 bp, to 2.32%.

NZ DOLLAR HOLDS
The NZ dollar eased back last night as the greenback came into favour. But today the local currency has held its own ahead of the long ANZAC Day weekend. Trading has been thin. The NZD is now at 69.3 USc, at 89.2 AUc and 61.3 euro cents. The TWI-5 is at 72.1. Check our real-time charts here.

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Daily exchange rates

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Source: RBNZ

Source: CoinDesk

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19 Comments

by Kakapo | 22nd Apr 16, 8:12pm 1461312740

So how about this, guys?

http://www.stuff.co.nz/business/79212068/special-investigation-importat…

NZ building industry shot itself in the face again?

by Justice | 22nd Apr 16, 9:29pm 1461317379

This goes on in all kinds of industries. My parents recently bought a bed but had to pay extra for the bed head. They had the choice of a black or white bedhead right, so they chose a white one. They were told it was NZ made, but funnily enough were told by the sales person that as they ordered a 'white' one it would take a few weeks as none were in the country. I put it together for them, it cost them well over $100 and it was essentially just some lock together pieces of MDF of the poorest quality you can imagine. I even had to find other fixings to make it stay together. To even claim or want to claim that it was 'NZ made'.........seriously, maybe they should try making milk powder

by Joe Public | 22nd Apr 16, 8:45pm 1461314751

David Chaston.

I challenge you/ your website to write an article next week on the pros and cons of a stamp duty tax on investors both local and foreign on buying existing housing stock. (new builds exempt). Would be good timing on the back of the changes in Victoria Australia

http://www.9news.com.au/national/2016/04/22/09/56/vic-stamp-duty-land-t…

It appears that interest.co.nz and other NZ media outlets are not interested / don't want to push stamp duty as a possible solution to the current crisis. I would like to understand why if that is the case. Are there conflicts of interest that we should be aware of ?

by ObeseBallerina | 22nd Apr 16, 8:53pm 1461315234

Envy Taxes never work. Only people that never have to pay them are so vocal for them.

by Justice | 22nd Apr 16, 9:16pm 1461316617

Ohh, but ENVY is what fuels the property market so.....can't have it both ways buddy

by ObeseBallerina | 22nd Apr 16, 9:49pm 1461318552

The only thing Im envious of is people retiring at 40. I dont have any house/car/boat envy at all.

by Justice | 22nd Apr 16, 9:59pm 1461319187

retiring from what? pulling your weight in society? (no pun intended) helping others? Once you retire what then, help in the soup kitchen at Xmas?

by ObeseBallerina | 23rd Apr 16, 1:45am 1461332752

The rat race. Is that too much to ask? So you are a boomer that expects people to pay taxes he never had to?

by Justice | 22nd Apr 16, 10:33pm 1461321218

Born 1971. Gen X ,never assume. I'm also a Virgo

by Joe Public | 22nd Apr 16, 9:20pm 1461316803

Envy taxes :) I own more than property.

The only difference is I care about first home buyers and feel that they have more rights to a house than an investor if the choice was between one and the other.

The long term impact of ever increasing prices will not be good for society in the long run.
- Tax payers will end up with the bill as rent subsidies increase with increase in house prices.
- With so much household income tied up in interest payments and rent less is available to spend in the economy.
- Less cash is available for other investment types with property being so lucrative for bank and investors.

Even if stamp duty doesn't work least the government will collect some tax which can be used for infrastructure improvements. If it does work then prices will not increase or may decrease and FHB will have more chance of getting on the ladder. Win Win situation I say.

by ObeseBallerina | 22nd Apr 16, 9:46pm 1461318415

So you're a boomer who has had his turn and making cash so its time to slam a tax on the generation below? Say what you want but buying a home has never been easy. I know the sacrifices I made before buying my first place when my mates were calling me all sort of blouse names while I saved and studied. Although prices are high interest rates are low and will be for a foreseeable period. One issue NZ has is low salaries and wages. That has to be addressed somehow. I voted with my feet but that doesnt stop the govt importing more people.

by Zachary Smith | 22nd Apr 16, 10:15pm 1461320117

There seems to be quite a few of these types on this forum. I'm starting to understand why the boomers are hated so much.

by Justice | 22nd Apr 16, 10:41pm 1461321705

Why exactly are you on this forum Zac ? I'm curious, what's your goal? What's your motivation? Serious questions btw.

by Zachary Smith | 22nd Apr 16, 11:54pm 1461326098

I am a man living among the ruins as best I can but also riding the tiger.
A troll, a jester, a voice crying in the digital wilderness. Long ago I objected to the direction the baby boomers were taking us but they wouldn't listen. Occasionally I send out a signal to the millennials: The Boomers stole your identity, your birthright and sold it to the highest bidder.

by Zachary Smith | 22nd Apr 16, 9:25pm 1461317138

Have you revolutionary types thought about establishing a Kiwi Generation Identity movement?

Generation Identity: A Declaration of War against the ’68ers

'68ers seems to be a French term for Boomers:

In particular, it is worth paying attention to the term “68ers” which appears in the subtitle. While this term specifically refers to the hippie wing of the Baby Boomer generation, it also adequately describes any modern progressive. They are a fusion between Social Marxist ideals, eternal liberal values as applied by a modern bureaucracy, and a certain amount of personal desperation.

Against these people “Generation Identity” marshals the formidable forces of desperation, loneliness and alienation and attempts to channel them through hope. Willinger acknowledges the problems that plague millennial generations — alcoholism, promiscuity, drug use, apathy — but points to them as a symptom to be overcome, not a desirable end-state.

by Justice | 22nd Apr 16, 9:34pm 1461317646

Jezz, this sounds like a perfect description of Trump! ;-)

Try harder Zac.

by Kakapo | 22nd Apr 16, 9:44pm 1461318246

More halfwitted pseudo-philosophical wank than Trump. .

by Joe Public | 22nd Apr 16, 11:29pm 1461324570

Two wrongs don't make a right. Greed is good was the 80s and 90s we have moved on since then. Time to let first home buyers back in. Agreed wages low probably as far too much is invested in property at the cost of other investment categories. Follow the UK lead. Tax breaks on startups for investors.

by Joe Public | 22nd Apr 16, 11:51pm 1461325866

Plus I said new builds are exempt so you can still make the killing you feel you are owed just not at the expense of first home buyears. So investors can be part of the solution not the problem. By encouraging new supply.