Here are the key things you need to know before you leave work today.
MORTGAGE RATE CHANGES
No changes for borrowers today.
DEPOSIT RATE CHANGES
ANZ has shifted its term deposit specials too, today, following Kiwibank yesterday. Their eight month 3.60% rate goes, replaced by a 3.50% nine month rate, so that effectively cuts by -10 bps. In addition, ANZ have raised their six month rate by +20% to 3.35% and their 1 year rate by +30 bps to 3.55%. (Kiwibank raised their 1 year rate to 3.60%.)
CORPORATE FIZZERS
First, Wynyard went into administration, and now Pumpkin Patch has also called has in the administrators. Two NZX listed equities in a week isn't a good look for the stock exchange, especially as the economy is in a purple patch at present. Wynyard had no bank debt, but ANZ is owed $46 mln by Pumpkin Patch. They were paying just 4.22% on this debt, so low interest rates couldn't save them. (PwC was the auditor in both cases.) This is not helping the NZX50 today, which is down more than -1.3% so far today. Evey other equity market in our time zone is lower too, let by the ASX (-1.4%) and Korea (-1.5%).
DUNNE DEALS ON IMMIGRATION
MP and Government Minister Peter Dunne's unveiled an immigration policy for his United Future Party, which focuses on four main areas and seeks tolerance. The four key ideas are: Establish a 10 year population strategy, introduce an employment sponsor fast track to residency, strengthen family reunification, and provide additional migrant support. Dunne said the policies would deliver an immigration service that "refutes the notion of closing New Zealand off to the world and allows people to bring their skills, their innovation and their productivity to New Zealand so that we can be a diverse and productive multi-cultural society".
SHIFTING AFFORDABILITY
First home buyers benefit as investors quit the Auckland market for greener pastures in the regions, according to the lates home loan affordability report out today. First home buyers in Auckland were slightly better off in September but rapidly rising prices in other regions may be a problem for FHBs there.
HIGH RATE, TOXIC CONDITIONS
ASB is seeking to borrow up to NZ$400m through the 'issue of complex financial products that are not suitable for many investors' - that is Co-cos. This is debt that will be converted into equity if the bank gets into trouble, so it is hard to see how it is even suitable for the professional investor. Lets hope the professional investors don't buy and stuff this into KiwiSaver funds. The attraction? it will be a bank issue paying more than 5%.
INFLATION UP IN AUSSIE
In a market surprise, the Australian CPI rose much more than expected in the September quarter, up to 1.3% from 1% in the year to June. The surprise caused the AUD to rise, and analysts to postulate that a potential rate cut by the RBA is likely off the table.
WHY WEAK DAIRY DOESNT AFFECT US SO MUCH
Overseas tourism spending jumped +20% in the last year, as the total tourism spend in New Zealand hits a whopping $35 bln. (Dairy exports?, well they totaled $11 bln in the year to August.)
'GREAT EXPECTATIONS'
ANZ released its Property Investors Survey today. These are investors who see the future just like the recent past. Confidence about buying property remains high. The proportion of investors planning to buy more properties rose to the highest since 2009, and investors are optimistic over returns (both capital gains and rental income) for both the year ahead and longer term. In terms of what is keeping property investors up at night, LVR restrictions and other regulatory changes are up there, but are trumped by the risk of damage to property, especially from methamphetamine. While the RBNZ’s tightening of the LVR restrictions is certainly causing concern among property investors that it will cramp their style, there appears to be little concern that the restrictions could topple the housing market. Cyclical risks such as lower returns barely warranted a mention. ANZ economists have their doubts about this optimism.
A NEW MILK MARKET?
Aussie dairy farmers have warned they could soon be importing milk from New Zealand and other countries if the crisis enveloping their dairy industry is not addressed. A group called Farmer Power has joined calls for a 50c a litre levy on milk to help farmers struggling against the pricing policies of major supermarkets and clawback schemes initiated by processors Murray Goulburn and Fonterra.
ANOTHER WMP JUMP
The derivative markets for WMP and SMP continue to push higher today, and are now up +9.4% from prices achieved at the last auction.
CHINA CONFIDENCE UP
Chinese consumer sentiment edged higher in October, led by a significant improvement in consumers’ willingness to spend, leaving confidence at the highest level since April 2016.
WHOLESALE RATES UP
Most swap rates rose +1 bp today but the 10 year rate is lower by -1 bp. The 90-day bank bill is up +1 bp to 2.14%. Yields for NZGBs are up by +2 and +3 bps today.
NZ DOLLAR LITTLE NET CHANGED
The NZD/USD has been a little volatile today, rising until the Aussie CPI was released when it tool collateral damage. It is now at 71.5 USc which is actually close to this time yesterday. On the cross rates, it is trading at 93.1 AUc, and is at 65.8 euro cents. The TWI-5 is now at 75.7. Check our real-time charts here.
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7 Comments
Peter Dunne's immigration policy sure is dopey. "Require a 10 year Population Strategy" Why not actually tell us what he thinks that strategy should be. Then we could like it, or not. I think we should decide on a desirable total population figure. I would prefer two million but would accept five million as a target. At this point I have no idea what Peter Dunne thinks of that. Why would I vote for him.
"Family reunification." Does he not realise this is one of the weakest processes. It's no secret that so many/most of the people flooding into Europe are young men. It's called a beachheading, so the rest of the family can follow. Hardly a good way to select.
Peter Dunne doesn't think anything about anything. Not since 'the worm' showed him that he can burble empty platitudes, drop things like 'common sense' and 'family' and people will inexplicably fall for it and assume that he agrees with them, even though he didn't actually say anything.
Dunne seems very behind the times. I don't think he is reading the mood of the people right.
introduce an employment sponsor fast track
We know a lot of job sponsorships are dodgy.
provide additional migrant support
I thought they were supposed to bring us money not cost us money.
KH - beachheading I know what you mean but I think a better military term is lodgement
A lodgement is an enclave taken by and defended by force of arms against determined opposition made by increasing the size of a bridgehead, beachhead or airhead into a substantial defended area, the rear parts of which—at the least— are out of direct line of fire.
I can tell you are a man by thinking along these lines.
NZ isn't as bad as some people like to make out.....
http://www.bloomberg.com/news/articles/2016-10-25/new-zealand-dethrones…
It's true - NZ ranked the 4th Safest country in the world!
http://ilovenz.me/blog/4th-safest-country-world/
NZ Rank is up yes....yes...up there with the best of em. Number 2 with a bullet.
Except in Ngāruawāhia , no more, where an eye for an eye and a battle of wits around P houses is par for the course.
Plus a few other places, I hear about that P is so rife, it has taken over from the other crack places of late.
Ask any policeman, why they do not venture off their patch...anymore.....nor anyone with a modicum of sense. They are not all ...one eyed.
Even the police do not venture out in numbers at night. Not even safety in that.
They prefer to clamp down on speed, during the day, not a long drag, cough, cough...as they should, at night.
No wonder it takes a Gang Leader with shotguns and balls to crackdown on cleaning up around him....at long last.
(I suppose desperation, takes desperate measures, when all around you is smoke and mirrors and snort filled candy bars, to start em off whilst ..young).
Or perhaps we are all so one eyed about our clean and green and pleasant land, that we do not recognise our true failings.
It seems so easy to import methamphetamine, in vast quantities, it ain't true., banned as it is
Maybe we have become the crack place so many people aspire to.
But not to swell the numbers here already...pretty please.....cos we sure is Smokin......enough...already.
But not for me...thanks....I remember when it was not big business, not acceptable, not a patch on the rest of the world...and a Bikkie was a biscuit....not a great chapter in our lives....and a policeman's lot.....was a happy one....and his bike was 3 speed as he sailed around each and every village and got to know his neighbours.....and did not have to mind his Ps and Queues.
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