A review of things you need to know before you go home on Friday; Sovereign raises mortgage rates, English can't see rate cut point, growth solid, Z Energy bonds, air travel booms, swap rates up, NZD holds

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

TODAY'S MORTGAGE RATE CHANGES
Sovereign announced its parallel rate rises to those announced yesterday by ASB.

TODAY'S DEPOSIT RATE CHANGES
Kiwibank cut its six month term deposit rate today from 3.60% to 3.15%. Westpac reduced its online saver rate to 0.35% from 0.50%.

STILL SHRINKING
Aussie manufacturing and the much larger services sector both contracted in September, but at a slower rate than in August. Their construction industry also contracted in August, but has eked out a small expansion in September.

THE POINT OF CUTTING BAFFLES BILL
Finance Minister Bill English is in the American capital for meetings with reps for the IMF and World Bank. He will also see the credit rating agencies. He is reported to have said everyone seems to think interest rates have reached the bottom, and will soon begin to climb again. "The Reserve Banks around the world believe more cuts in interest rates may not have the stimulating effect on the economy that they used to have," he said. When he gets back, I wonder if he will pass that view on to the RBNZ. Markets here still think the RBNZ will cut rates one more time this year. It sounds like English is unsure why. He certainly isn't about to do any fiscal stimulus either.

LOCAL KNOWLEDGE
Following on from ANZ's Truckometer judgment that NZ economic growth is developing solidly, Westpac economists have come to a similar conclusion from their own analysis. Activity indicators were subdued in August they said, with softer trends in housing, agriculture and tourism indicators. "Nonetheless, growth looks set to continue at a solid pace for the rest of this year."

$151 MLN @ 4% PLUS
Z Energy today announced that, following the successful book-build for its offer of five year and seven year fixed rate bonds, $151 million of bonds have been allocated across both series of bonds to participants in the General Offer. $110 million of 2021 Bonds, which have a maturity date of 1 November 2021. The interest rate for the 2021 Bonds has been set at 4.01% pa. $41 million of 2023 Bonds, which have a maturity date of 1 November 2023. The interest rate for the 2023 Bonds has been set at 4.32% pa.

A BOOMING SECTOR
International air travel was up +4.6% in August, a slowing of the +6.4% year-on-year gains in July. However, gains in the Asia-Pacific region are still strong, growing +7.8% in August. Given NZ visitor arrivals are up +9% in the same period, we are clearly getting our share and more.

WHOLESALE RATES INCH UP
The wholesale rate rises are still coming although the pace of the increases has slowed today. Most terms were just +1 bp higher, although the ten year is up +2 bps. The 90-day bank bill is down another -1 bp to 2.18%.

NZ DOLLAR HOLDS
The Kiwi dollar has level-pegged with the USD today, allowing some small gains on the cross rates. The NZD/USD is now at 71.4 USc. On the cross rates, it is trading at 94.2 AUc, and is at 64.2 euro cents. The TWI-5 is 75.3. We are also now at an all-time high of 57.4 pence against the GBP as the UK currency takes another 'pounding'. Check our real-time charts here.

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