A review of things you need to know before you go home on Wednesday; no rate changes, solid jobs growth, wage signals warmer, QV sees slower growth, bank CEOs told to 'prove it', petrol up, swaps up, NZD stable

Here are the key things you need to know before you leave work today: (the Uber story is the update.)

MORTGAGE RATE CHANGES
No changes to report today.

TERM DEPOSIT RATE CHANGES
None here either.

SOLID EMPLOYMENT GROWTH
Our jobless rate fell in the March quarter to 4.4%, in line with the Reserve Bank’s forecast. The number of unemployed has fallen (on a year-on-year basis) in every quarter except on since the start of 2016, and in 15 of the past 20 quarters (that is, over five years. Meanwhile, employment growth over those five years has never fallen and now amounts to +422,000 additional jobs. Our very high participation rate was unchanged at 71.2% and just one tick of its record high. (Within that, the Māori participation rate is also a remarkable 69.9%.)

WAGE GROWTH SIGNALS
On the pay front, average weekly gross earnings (which includes overtime) is up +5.6%, whereas average full-time earnings excluding overtime are up +3.8% year-on-year to $1,176/week. This data is in the Quarterly Employment Survey (QES). (Public sector averages on this ordinary time basis are $1,484/week, a +2.2% pa rise.) The separate LCI data ("labour cost index") was up only +1.8%. So it is confusing as to what is really going on in terms of wage growth. We suspect the QES is actually signaling growth that the LCI will reflect in later quarters.

SLOWING
QV says while many regional centres are still seeing steady increases in price, the rate of growth continues to 'slow, plateau or even drop slightly' in the main centres. CoreLogic doesn't expect any falls however, even if the situation is soft.

"PROVE IT"
The FMA's CEO Rob Everett and RBNZ Governor Adrian Orr tell NZ's big bank CEOs to prove their banks are different to their Aussie parents, in light of the Aussie inquiry into financial services industry misconduct.

AFFIRMED
Ratings agency Fitch as affirmed Australia's AAA sovereign credit rating ahead of their 2018/19 Budget on May 8. They see an improving fiscal situation, underpinned by stronger tax collections.

WARNING FROM CLARKE
See this. Advertorial is ok however.

INFLATION IMPULSE
In their latest update, MBIE's petrol price survey puts the discounted U91 price at $2.04/L and the average pump price at $2.179/L. That is the highest we have seen it since October 2014 and it is +19% higher than in June 2017. Year-on-year it is +6.7% higher.

EXISTENTIAL?
Uber is in trouble in its home state of California. Their Supreme Court just ruled that to classify someone as an independent contractor, businesses must show that the worker is free from the control and direction of the employer; performs work that is outside the hirer's core business; and customarily engages in "an independently established trade, occupation or business." This case didn't directly relate to Uber, but applies to them all the same. It is a view that will likely spread - and hasten Uber's push into autonomous cars.

BENCHMARK INTEREST RATES UP
Local swap rates got steeper today. The two year is down by -11 bp, whereas the five year is up +1 bp, and the ten year is up by +3 bps. This reverses yesterdays changes. The UST 10yr yield is at 2.97%, up +1 bp. The Aussie Govt 10 yr is now at 2.78% (up +2 bps). The China 10 yr is up +2 bps at 3.67%. The NZ Govt 10 yr is down another -1 bp at 2.83%. The 90 day bank bill rate is up +1 bp to 2.03% today.

BITCOIN HOLDS
The bitcoin price is now at US$9,035 which is up less than +1% from this time on yesterday.

NZ DOLLAR HOLDS
The NZD is flirting with the 70 USc level today and was briefly below it earlier although now it is back at 70.1 USc where it was when markets opened this morning. We are marginally higher on the cross rates where we at 93.5 AUc and at 58.4 euro cents. That has the TWI-5 unchanged at 72.6.

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