A review of things you need to know before you go home on Wednesday; more rate rises, Aussie inflation stumbles, metal prices jump, NZ 'least corrupt'; EQC challenged; swaps rise, NZD holds high

A review of things you need to know before you go home on Wednesday; more rate rises, Aussie inflation stumbles, metal prices jump, NZ 'least corrupt'; EQC challenged; swaps rise, NZD holds high

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

MORTGAGE RATE CHANGES
The Co-operative Bank, and SBS Bank both raised fixed mortgage rates. First Credit Union added two fixed rates to their offer, for 1 and 2 years.

DEPOSIT RATE CHANGES
The Co-operative Bank matched its mortgage rises with equivalent term deposit rises. Kiwibank also raised a TD rate, adding +30 bps to their one year offer. Heretaunga Building Society made a minor change to their 3 month TD rate.

RECLAIMING ITS MOJO?
Credit card balances grew +2.4% in the year to December. That was the slowed December growth level in more than four years. Back in the year to December 2013 growth was +4.9%. It is not all good though; the recent growth from August has been ramping up quite fast.

AU CPI SURPRISES
The Aussie CPI data for December was out today. Prices are up +1.5% over all of 2016, a subdued rise and slightly below expectations. In fact, +1.5% is a 19 year low. And this was despite vegetable prices jumping +12.5% in the year. The low level has people talking up another RBA rate cut.

SOME KEY COMMODITIES JUMP
The commodity price of aluminium has risen to its strongest level since May 2015. Talk of capacity cuts in China drove the rise. Zinc and copper also both rose strongly today in London (LME) trading.

BUT NOT WMP
Prices on the NZX dairy derivatives market are not showing the same enthusiasm as for metals. The view for these 'softs' is quite uninspiring.

BACK CLEANEST
No country is corruption-free of course and we have our issues. However, New Zealand was ranked the least corrupt of all in 2016, according to Transparency International in their 2016 rankings out today. In 2015 we were fourth, so this is a big move, beating out Denmark for the top spot. Actually, we have been top for eight of the past ten years, so 2015 was the aberration. (Also interesting, Transparency International has its own internal issues: it has disaccredited its US affiliate. It is not very clear why.)

TURNERS IN $150 MLN BNZ-ARRANGED SECURITISATION DEAL
Automotive financial services group Turners has announced credit approval for an "initial" 150 million dollar asset backed receivable securitisation programme arranged by the BNZ. Turners says the programme will accommodate "the majority" of the company's receivables originated through the Dorchester Finance, Oxford Finance, and Southern Finance businesses, as well as the receivables generated via Turners recently established MTF Partnership Channel. The securitisation programme will be implemented during the month of February, with governance services to be provided by New Zealand Guardian Trust. The first receivable sales transactions are scheduled to occur during March 2017.

NEAR THE END?
Credit Suisse analysts in Australia are claiming that unless a buyer can be found soon, Fairfax will shut down its New Zealand newspapers, including the Waikato Times, the Dom Post, the Christchurch Press, and many regionals. (But this is only an analysts claim, not hard news.)

COURT TO DETERMINE EQC'S LAND DAMAGE LIABILITY
IAG and Tower are taking the Earthquake Commission to court to clarify how much the government agency needs to contribute towards paying Canterbury earthquake claimants with damaged homes on land that faces increased liquefaction vulnerability (ILV). IAG says it’s been paying claims for this sort of damage on behalf of EQC, with the understanding it would be compensated for the costs. But as it turns out, it’s been using a different method to EQC, to calculate these costs, so wants to be compensated more than EQC believes is fair. A legal ruling will therefore confirm EQC’s liabilities and whether private insurers’ can recover any costs. If successful, IAG says the ruling will result in higher payouts for customers.

WHOLESALE RATES RISE
Following the sharp rise on Wall Street earlier today, local swap rates have resumed their up trend, but more modestly than the American change. They are up +2 bps for two years, up +2 bps for five years, and up +3 bps for ten years. The 90 day bank bill is unchanged at 1.97%.

NZ DOLLAR HOLDS HIGH
Despite some intraday ups and downs, we are at about the same strong level we were at, at this time yesterday. The NZD is back at 72.4 USc. On the cross rates, we are up at 96 AUc, and at 67.4 euro cents. The TWI-5 index is now at 77.9. Check our real-time charts here.

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16 Comments

Why would someone say something like that about Fairfax , unless it had a huge amount of cred ?

Perhaps Fairfax engaged Credit Suisse for their consulting services.
Such a claim will sound more convincing coming from "unrelated" big bank analysts than it would from those with the most to gain.

Is the NZ $ bucking a trend or is it just our imagination ? Why on earth does our NZ$ seemingly remain so stubbornly high , even in light of a US$ that is stronger .

USD has been unwinding post Trump euphoria.

Japan snapped a 14-month run of falling exports in December, with shipments to China setting a record as global demand picks up. The rise left Japan with a trade surplus for a fourth consecutive month. Read more

More alternative facts or just plain fake news?

I’ve been told by numerous Wall Street traders recently that hundreds of billions of dollars are now on the move. And that’s just the stock market. If you include bond trading, you can take that figure up to a trillion dollars.

Donald Trump has become the single biggest market influencer of our time.

That was from ABCNews, not the US media company but the Australian one.

In context, you find that markets aren’t really all that much moved, in most cases only partially retracing the massive declines of the years before. Read more

Corruption ratings. Have things improved here? Perhaps? Or are things getting worse elsewhere?

Either? Both? Whoever does the ratings have been corrupted themselves?

I reckon the US chapter expressed some pro Trump views which led to a fall out which led to their disaccreditation. There are articles about 'populists' and Trump on the International home page.

The title of the Transparency International Index is "Transparency Perception Index"
Just means NZ talks a very good talk and very little gets into the court system

New Zealand was ranked the least corrupt of all in 2016

I loathe how everyone makes this claim. We have the lowest corruption perception, which does not imply the lowest corruption.

I think Transparency International took more than just a quick glance at different countries. It is reasonable to infer, after looking at things from multiple angles and doing research, that the perception of low corruption does indeed imply or suggest actual low corruption. They may be culturally biased although I don't have a problem with that. Their perception matches our perception, fancy that. Anyway I say let's celebrate.
It occurs to me that the cynicism in this thread probably helps keep us the least corrupted. We're whinging, petty, blockheads but maybe it serves a purpose.

Firstly
“Transparency International has its own internal issues: it has disaccredited its US affiliate.
It is not very clear why.”

Chuckle. Very droll.

Secondly:
NZ least corrupt? Who'd we pay off for that rating? That claim could do with some of this newfangled "fact checking" I've been reading so much about.

Finally:
Credit Suisse analysts and Fairfax. Snort. No business association there, I'm sure. Post truth, indeed.

We may be the least 'corrupt' but we are also probably one of the most crony-ish

America is great again. No debt there. No corruption. Just like NZ.
People pay their taxes, Banks are sound. Business is booming.
Quantitative easing was a mistake, anyone can make.
Depression is sad, do not worry.
Keep on borrowing. Follow my leader. Think Big, Think everything is rosy.
Think Donald cares about debt. Keep smiling. Wave...the Flag.
And it will all go away. And ours did.
http://www.usdebtclock.org/
Theirs is bigger than ours. We can play catch up...soon.
Do not corrupt the figures....Just the facts.