A review of things you need to know before you go home Tuesday; electronic card spending; monthly inflation gauge; data usage; fibre-optics; Statistics House; rates and NZD stable

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

MORTGAGE RATE CHANGES
No changes to report here.

DEPOSIT RATE CHANGES
ICBC Bank has reduced is 1 mnth to 12 mnth rates but has increased the 2 yr to 5 yr rates. See rates here.

ELECTRONIC CARD SPENDING
On a month-on-month seasonally adjusted basis, retail card spending was up 0.1% in September 2017, compared with August 2017. Spending fell in four of the six retail industries, where the largest movement came from sales of goods including appliances and furniture being down 1.2%. Grocery and liquor sales on the other hand were up 0.8%. In September 2017, card holders made 137 mln transactions with an average value of $48. The total amount spent was $6.6 bln.

ANZ INFLATION GAUGE
The ANZ inflation gauge rose by +2.8% year-on-year in September 2017, up from +2.6% in August 2017. On a month-on-month basis, the gauge rose 0.4%, which is the strongest September rise since 2011. Electricity made the largest contribution this month, with accommodation services, purchase of housing costs, health insurance, telecommunications and rents rounding out the top six. Of the 36 groups in the gauge, 10 rose, 3 fell and 23 remained unchanged.

DATA USAGE
Broadband connections consumed 276 mln gigabytes of data in the month of June 2017, which is enough to watch 92 mln hours of high definition content - more than 10,000 years of screen time. This is a 93% increase from June 2016. The number of broadband connections with no data cap increased to 62% by June 2017 and 12% had a cap of 100 gigabytes or more. The increase in residential data usage is most likely influenced by people moving to online services for news and entertainment.

FIBRE-OPTIC CONNECTIONS
The number of fibre-optic connections used in New Zealand reached 397,000 in the year ended June 2017. This is up 67% from the June 2016 year and makes up 21% of all broadband connections in New Zealand. There were 159,000 new fibre-optic connections established in the year to June 2017 compared with 133,000 in the year to June 2016, showing that fibre-optic connections are rising at a rapid pace. The Ultra-Fast Broadband program aims to have 87% of New Zealanders being given access to fibre by the end of 2022. Fibre-optic connections are a lot faster than traditional copper connections and allow households to have several people watching movies and playing video games at the same time.

STATISTICS HOUSE DEMOLITION
Stats NZ Chief Executive, Liz MacPherson, has welcomed an end to the uncertainty around Statistics House in Wellington after CentrePort has confirmed that Statistics House will be demolished. Stats NZ staff have been working in other buildings in central Wellington since the Kaikoura earthquake 11 months ago and these leases are in place for another year. The Government Property Group is now looking for a more permanent solution. Stats NZ was fully insured and is still working with insurers to determine the settlement.

NEW BOND OFFER
ANZ and Westpac have been appointed as the joint lead managers for a new bond offer from the Bank of China (New Zealand) Limited. The offer opened today, closes on 12-Oct-2017 and will be issued on 17-Oct-2017. The issue is for $75 mln, has an indicative interest rate margin of 1.35%-1.45% and matures on 17-Oct-2022. The issue has an expected Standard and Poor's rating of A. Minimum subscription to the offer is $5,000 with multiples of $1,000 thereafter.

NO MORE PLASTIC BAGS
New World has announced that it plans on going single-use plastic bag free by the end of 2018. In a recent survey conducted by the supermarket chain, an overwhelming majority voted yes to being charged for bags and a number of respondents suggested reusable bags should be used. New World is implementing a number of initiatives to achieve this goal, which includes giving away 2 mln reusable bags, introducing a voluntary 10c donation per plastic bag used, which will go to environmental causes, and providing a 5c rebate for each reusable bag used in the North Island stores.

WHOLESALE RATES STABLE
Local swap rates were almost flat today, with all movements across the curve less the 1 bps. The 90 day bank bill rate was unchanged at 1.93%.

NZ DOLLAR HOLDS
The NZ dollar is consolidating below the 71 USc level and is currently trading at 70.7 USc. On the cross rates we are at 90.9 AUc and at 60.2 euro cents. The TWI-5 is now at 73.6. The bitcoin price is up to US$4,850.

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USD 
NZD
End of day NY time
Source: CoinDesk

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9 Comments

Japan’s current-account has been in the black every month since June 2014, reflecting the size of the nation’s overseas investments and its trade surplus, which has been partly the result of a weaker currency. The current account surplus, which is more than 3 percent of the size of Japan’s gross domestic product, was a contributing factor in landing the country on a U.S. Treasury currency watch list. Read more

"The current account surplus, which is more than 3 percent of the size of Japan’s gross domestic product, was a contributing factor in landing the country on a U.S. Treasury currency watch list."

Come on Japan, follow US, can't you just borrow more, owe more and consume more. Isn't it time you learnt that the only future is consumertopia. We're well on target to trash the planet so who cares what you owe.?

"Fibre-optic connections are a lot faster than traditional copper connections and allow households to have several people watching movies and playing video games at the same time."
Exactly! Thats why I am sticking with copper.
One copper connection is plenty fast enough for two whole households where I live. No OD'ing on computer stuff here.....

Theirs to pillage?

More global fund managers are setting up shop in Australia, drawn to the nation’s A$2.3 trillion ($1.8 trillion) pension savings pool and new local investment opportunities.

THL Credit Inc., an alternative credit manager based in Boston, said in September that it hired a director in Australia. New York-based credit hedge fund GoldenTree Asset Management opened an office in Sydney last month after appointing a local managing director. Oaktree Capital Management, which already manages Australian pension money, headed Down Under last year as it also sought local investments.

The developments are part of a broader global trend as low interest rates in North America, Europe and Asia prompt money managers to increasingly seek assets they had previously seen as too risky. There are also uniquely Australian factors. The world’s fourth-largest pension pool is swelling due to mandatory retirement saving rules. Many Aussie funds have little choice but to seek overseas investments as well as alternative assets as they outgrow local equity and corporate bond markets. Read more

That would be propping up the NZ sharemarket too.

NZX50 hit another new high today....just.

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

Onwards and upwards baby.

That interest rate margin for the Bank of China seems low given that we have now reached peak house price and interest rates are sure to go up from here.

The monster of economic waste - over $7 trillion of dictated stock buybacks since 2003 by the self-enriching CEOs of large corporations - started with a little noticed change in 1982 by the Securities and Exchange Commission (SEC) under President Ronald Reagan. That was when SEC Chairman John Shad, a former Wall Street CEO, redefined unlawful ‘stock manipulation’ to exclude stock buybacks.

Then after Clinton pushed through congress a $1 million cap on CEO pay that could be deductible, CEO compensation consultants wanted much of CEO pay to reflect the price of the company’s stock. The stock buyback mania was unleashed. Its core was not to benefit shareholders (other than perhaps hedge fund speculators) by improving the earnings per share ratio. Its real motivation was to increase CEO pay no matter how badly such burning out of shareholder dollars hurt the company, its workers and the overall pace of economic growth. In a massive conflict of interest between greedy top corporate executives and their own company, CEO-driven stock buybacks extract capital from corporations instead of contributing capital for corporate needs, as the capitalist theory would dictate.

Yes, due to the malicious, toady SEC “business judgement” rule, CEOs can take trillions of dollars away from productive pursuits without even having to ask the companies’ owners—the shareholders—for approval. Read more

China Central Bank Boss Calls for Reform Amid Congress Countdown

https://www.bloomberg.com/news/articles/2017-10-10/china-s-central-bank-...