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A review of things you need to know before you go home Monday; no rate changes, AU GST system panned, AIA bond details, Fexi Cards does credit card securitisation, houses for sale stocks tighten, swaps slip up, NZD slips down

A review of things you need to know before you go home Monday; no rate changes, AU GST system panned, AIA bond details, Fexi Cards does credit card securitisation, houses for sale stocks tighten, swaps slip up, NZD slips down

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

MORTGAGE RATE CHANGES
No changes to start the week.

DEPOSIT RATE CHANGES
No rate changes here either.

'BEYOND COMPREHENSION'
The Australian GST system has been described as broken "beyond comprehension" by its Productivity Commission (see p2). Their's is a system with variable rates for food (like NZ First campaigned on here), and revenue sharing with states (as was also campaigned on here for our cities and local authorities). But the Aussie system has grown so complicated, it is draining support for GST overall.

AIA BOND CONFIRMED
Auckland International Airport confirmed today that it is offering up to NZ$75 mln of fixed rate bonds maturing in April 2023 (with the ability to accept up to NZ$25 mln of over-subscriptions) to retail investors and to institutional investors. This issue replaces a $100 mln bond that matures on October 17, 2017 which had a coupon of 5.47%. It is likely the new issue will have a yield of about 3.6%, +0.85% above the 5 year swap rate on Wednesday, when the actual rate will be decided.

SECURITISING CREDIT CARD DEBT
Flexi Card is selling $120 mln in securitised paper based on New Zealand credit card and fixed installment receivables originated by Flexi Cards, mainly through their Q-Card product. NZ$97.9 mln of this issue that is rated AA or better by Fitch is being offered to the public. Pricing is expected to be about 1.15% to 2.25% above the reference 1 month BKBM rate (which is about 1.84%) so that puts the range about 2.99% to 4.09% pa.

INVENTORIES TIGHTEN
Realestate.co.nz is now reporting we have 16.5 weeks of property listing inventory based on REINZ sales rates. That is down from 17.6 weeks at the end of August. In Auckland, the level is 18.4 weeks (21.1 weeks in August) and the worst main centre data, in Bay of Plenty it is 12.1 weeks (14.3), in Hawke's Bay it is a skinny 9.2 weeks (9.7), and in Wellington it is the skinniest 7.4 weeks (8.9). On the Coromandel it is 29.6 weeks.

SMEs SMILING
Local small to medium enterprises (SMEs) are enjoying a period of sustained growth with the expectation this will continue over the next 12 months, according to the latest research by leading accounting software provider MYOB. In the latest MYOB Business Monitor Economic Snapshot of 400 SMEs nationwide, 37% reported a revenue increase in the last year, tracking slightly up from 36% in March, with almost half (46%) expecting their revenue to increase over the next 12 months. 

BNZ TO OFFER CUSTOMERS APPLE PAY
BNZ says it's set to become the second NZ bank to launch Apple Pay. The bank's website says Apple Pay is "arriving this October." ANZ launched Apple Pay in NZ last year.

XI'S ECONOMY SLOWS AT WRONG TIME FOR HIM
The latest reading of the Caixin China services PMI makes for uncomfortable reading by President Xi. The Business Activity Index came in at 50.6 in September, the lowest since December 2015 and down a sharp -2.1 points from the previous month. Although new business rose at a slower rate last month than in August, input costs and prices charged both increased. Their inability to turn China into a consumption-led economy must be worrying policymakers there. There must be some in the CCP wondering if they are on the right track (but they won't be wondering out loud).

UNEXPECTED CONSEQUENCES
In Canada, a major bank there has warned that housing affordability will get worse in 2018 as rates rise and regulations aimed at improving affordability bite. The situation will be toughest there for first home buyers, they say.

WHOLESALE RATES SLIP UP
Local swap rates rose another +1 bp across the board today but the 90 day bank bill rate reversed direction, down -2 bps to 1.93%.

NZ DOLLAR HOLDS
The NZ dollar continues its slow motion slip, but has held its level today at 70.7 USc with the US markets closed today and tomorrow for their Columbus Day holiday. On the cross rates we are at 90.9 AUc and at 60.3 euro cents. The TWI-5 is now at 73.7. The bitcoin price is up +6.3% at US$4,594, its highest level since early September. (The record high is US$4,992 which it briefly achieved in September 1, 2017.)

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4 Comments

The evil capitalist empire trashing of the planet. "If you go fishing in the New York Bight or take a ferry around the Rockaway Peninsula, chances are you’ll spot one of the world’s largest mammals—the whale.

Whales, once native in New York, vanished from the waters about a century ago due to industrial pollutants and raw sewage that have been dumped into the water.

Vast schools—sometimes as big as a football field—of the menhaden baitfish are swimming in the New York Bight, and they’ve lured some unexpected visitors into the waters just a few miles from downtown Manhattan. Numerous whale species have returned to the Bight to feed on the menhaden, and although they haven’t set foot—er, fin—in New York’s waters for decades, some scientists say their return signals a wildlife resurgence."
https://www.sciencefriday.com/articles/in-nyc-waters-a-whale-of-a-tale/

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Why has "realestate.co.nz" not published their "Property report" for September? They generally publish this data very early in the month following ?

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NZX50 charges to a new high. Is there a more highly charged index in the developed markets so close to the total value of market cap?

https://www.nzx.com/markets/NZSX/securities/FNZ

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