Here are the key things you need to know before you leave work today.
MORTGAGE RATE CHANGES
No changes to report today.
DEPOSIT RATE CHANGES
Westpac launched a 3.70% 1 year TD special, moved its 6 month rate up and cut back its 8 month rate. These changes came after ANZ's reduction.
IMBALANCE
According to realestate.co.nz, listings of homes for sale are surging as sales remain sluggish, which could create an overhang of unsold properties next year. A housing market hangover in the New Year seems likely. Nationally, there are now 20 weeks of inventory at current sales rates, the highest since early 2015. In Auckland there are 23 weeks, the highest since 2012. Remember, this was down to just 9.2 weeks in May last year. On ecity where it is still tight is Wellington, which is still at just 9 weeks of inventory.
FONTERRA PAYS THE PRICE
Fonterra has been hit with a $183 mln damages bill by an arbitrator over its precautionary infant formula recall. Client Danone, who made the claim, sees the decision as a 'guarantee that the lessons from the crisis will not be forgotten'. The cost will take -10c off this year's dividend. Meanwhile, prices for WMP have not suffered.
A RECORD HIGH
New Zealand's terms of trade rose to an all-time record high in the September 2017 quarter. The previous high was in June 1973 (which as just before the UK decided the enter the European Common Market. Back then we lived by selling lamb carcasses and wool to the UK.) In the past 16 years, our export prices have held relatively stable, but the prices we pay for imports have fallen -27%.
A POWERFUL COMMISSIONER
The Aussie Government has appointed a top retired judge to head its Royal Commission into misconduct in the financial sector. We tend to think of this as just targeting banks, but in fact it will cover issues in the insurance industry as well, the "financial services industry", and it will cover managers of superannuation funds. That means it will also inspect union behaviour and capture of some industry super funds - which may make for some interesting outcomes.
WHOLESALE DOWN AGAIN
Swap rates are down -1 bp today across the board. The 90 day bank bill rate has held at 1.91%. In China, their 5-10 curve has gone negative again today (but their 2-10 curve is still quite positive).
NZ DOLLAR UNCHANGED
The NZ dollar is little changed at 68.4 USc. On the cross rates we are just under 90.3 AUc, and 57.4 euro cents. But the TWI-5 has slipped to 71.1. Bitcoin is still an impending car crash you can't stop watching (Trump-like). It ended the month in New York at US$9,917 having actually never ended any day over US$10,000. It started the month at US$6,448 and in intra-day trade reached US$11,364. Right now, it is at US$9,772.
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4 Comments
Eurostat, Europe’s statistical agency charged with estimating various economic accounts including the EU’s inflation figures, puts November 2017 inflation for the EA 19 group at just 1.5% (Harmonized Index of Consumer Prices, or HICP). Worse for the ECB, the core HICP rate, which strips out volatile food, energy, tobacco, and alcohol prices, was for the second straight months less than 1% (both October and November work out to a 0.9% core inflation rate). Read more
Short sellers may be aggravating China’s biggest bond selloff in four years.
While the nation’s debt market has no official measure of short sales, analysts say a surge in bond lending has been partially fueled by rising bearish bets. A record 1.82 trillion yuan ($274 billion) of notes has been lent out this year, 18 percent more than the total for all of last year, according to clearinghouse ChinaBond. Short sellers profit from falling bond values by selling borrowed notes and buying them back after prices fall. Read more.
Billabong, in trouble, quietly mumbled along at ~60 cents for ages ( was nearly 60 buck a couple of years back!) and out of the blue, 10 days ago, there was an uptick in the price! Today Quicksilver made a takeover bid. Tell me insider trading is dead....
https://nz.finance.yahoo.com/quote/BBG.AX?p=BBG.AX
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