A review of things you need to know before you go home on Tuesday; local factory volumes up, sales down, farmers satisfied with banks, Fonterra invests $240 mln, EQC sidelined, swaps stable, NZD up

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

MORTGAGE RATE CHANGES
There are no changes to report today.

DEPOSIT RATE CHANGES
No changes here either.

SO-SO
The New Zealand manufacturing sector had a variable September quarter. The actual volume of total manufacturing sales was up +4.8% year-on-year. When price changes are included however, the value of manufacturing sales was $23.3 bln in the quarter, down -1.4% from the same quarter a year ago.

HITTING NEW 8 YEAR HIGHS
Interest rates on short-term US Treasury bills rose in today's auction to their highest levels in eight years. The US Treasury Department auctioned US$34 bln in 3 month bills at a discount rate of 0.53%, up from 0.49% last week. This was the highest rate since October 27, 2008. Another US$28 bln in 6 month bills was auctioned at a discount rate of 0.645%, up from 0.615% last week. This was the highest rate since November 17, 2008.

FARMERS STILL SATISFIED WITH BANKS
Federated Farmers runs regular survey among members on bank satisfaction and the latest one was released today. Bank satisfaction overall remains strong with 81% of the almost 1000 responders revealing they were very satisfied or satisfied with their bank, up one percent from the previous survey in August. Seven percent were feeling dissatisfied or very dissatisfied, also up one point. Similarly, 77% of farmers rated their bank’s communication excellent or good. This is down a little from August but still strong overall. Seven percent believed it had been poor, up one point. Satisfaction at these levels is similar to the levels we see in overall customer surveys. ('Satisfaction' is a different concept to 'loyalty', and different to 'trust'.)

UDC'S ANZ CREDIT LINE INCREASES, CAPITAL RATIO FALLS
On-the-block finance company UDC has more than doubled the size of its loan facility from parent ANZ over the past year. UDC's credit facility with ANZ was lifted to $1.8 bln on November 24. That's up from $800 mln at September 30 last year. As of September 30 this year, $595 mln had been drawn down with UDC paying 3.07%. As of September 30 the finance company also had $1.6 bln of secured deposits on issue, down $144.315 million, or 8.3%, year-on-year. Separately, UDC's capital ratio was 9.9% at September 30, down from 16.2% a year earlier after Reserve Bank exemptions expired. The Reserve Bank's minimum requirement is 8%.

A NZ$240 MLN INVESTMENT
Fonterra is to expand its Clandeboye facility with a new IQF mozzarella expansion. The new plant uses patented technology to produce high quality, natural mozzarella without using chemicals in the production process. This technology was developed by a Primary Growth Partnership. The research proved technology that can produce natural individual quick frozen mozzarella in six hours, a process that traditionally took three months, leading to the Fonterra commitment of $240 mln at the site.

A DIFFERENT PROCESS
An agreement between private insurers and the EQC will simplify how home and contents insurance claims are resolved for people affected by the Kaikoura Earthquake. Under the agreement, private insurers will act as EQC’s agents and receive, assess and settle home and contents claims for earthquake damage from their own customers, even those claims that are under the EQC cap. EQC will assess land damage as land is not covered by private insurance policies.

'STUCK IN THE MUD'
Trade Me Property says asking prices are well up in most parts of the country but a rush of new supply means the Auckland apartment market is stagnating.

UP, BUT MODERATING
Australian house prices rose on average +3.5% in the year to September, their weakest rise in more than 3 years. In the September quarter, residential property prices continued to fall in Perth and Darwin, while prices rose in all other capital cities. Sydney recorded the largest quarterly residential property price growth of all capital cities, with house prices rising +2.9% in the quarter. The total value of Australia's almost 10 mln residential dwellings increased to NZ$6.5 tln. (The New Zealand equivalent value will be released on December 22, and is expected to top NZ$1 tln for the first time.) That means, the value of all Aussie housing is now worth 3.7 times annual [nominal] GDP. In New Zealand the multiple is 4.0 times.

AGAINST THE ODDS
Japan today followed New Zealand and Vietnam, and ratified the Trans Pacific Partnership. Trump's cabinet appointments and the Republican-controlled Congress keep the prospect alive that the US may in fact end up joining as negotiated. But it's a longer shot since Trump was elected.

EXPENSIVE, BUT LESS
There were 29 Public Service departments in 2015/16. The total cost of paying their chief executives was $14.3 mln over the year, and average of just under $500,000 each. In fact, this is lower than the cost in 2008/09.

EXCEEDING EXPECTATIONS
Chinese retail sales in November came in +10.8% higher than the same month a year ago. This was a bigger gain than expected.

SORRY III
The DOS attacks were back this morning, but we think (?) we may be getting on top of this issue now. If you know of someone who can't access our service, could you please get them to email me directly; there are ways to get them back on.

WHOLESALE RATES SETTLE
Swap rates have held today, slipping just -1 bp across the curve. The 90-day bank bill is up +1 bp at 2.04%.

NZ DOLLAR FIRMS
The Kiwi dollar has risen a little today. It is now at 72 USc. On the cross rates it is at 96 AUc, and is up at over 67.7 euro cents. The TWI-5 now at 77.8. Check our real-time charts here.

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