Here are the key things you need to know before you leave work today:
MORTGAGE RATE CHANGES
The Co-operative Bank cut its one year fixed mortgage rate to 4.29%, matching most challenger banks. Apart from HSBC Premier's offer, this is the lowest carded rate for this term.
TERM DEPOSIT RATE CHANGES
No changes today.
JOB VACANCIES RISE STRONGLY
According to the April MBIE survey, vacancies increased in nine out of ten industry groups. The largest contributors were the education and training (up +2.4% above March levels), and healthcare and medical (up +1.5). Vacancies increased in all eight occupation groups. The largest increases were for labourers (up +1.9), and community and personal services (up +1.5). Vacancies increased in all five skill levels. And they increased in all ten regions over the month, with the biggest increases in Gisborne/Hawke’s Bay and Waikato. Over the past year, online vacancies increased by +7.9%.
ANZ POCKETS $20M FROM FAILED UDC SALE
ANZ has disclosed a $20 mln "gain on UDC terminated transaction." This comes after the bank's plan to sell its finance company to China's HNA Group was blocked by the Overseas Investment Office. ANZ says the $20 mln stems from "cost recovery" in respect of the terminated transaction process. ANZ's now considering selling UDC through an IPO or trade sale.
MORE DEPARTURES FROM BNZ'S TOP TABLE
BNZ has announced another two departures from its executive team. The bank's director of products and technology, David Bullock, and director of customer fulfillment services, Martin Gaskell, will leave at the end of June. CEO Angela Mentis, who took the reins at the start of the year, says new executive appointments will be made in due course. The latest departures come after Richard Griffiths, director of transformation and enterprise performance, and David Maloney, director of strategy and planning, left in April. Their replacements are also to be announced in due course. In March Peter MacGillivray was appointed CFO after Mandy Rutherford withdrew from taking up the job. (Here is BNZ's full executive team).
FROM THE COALFACE
An April ANZ survey of its field officers and their clients portrayed an economy performing well but suffering some growing pains. "The construction sector remains extremely busy, but cashflow is an increasing problem, and Auckland is a very competitive market. The housing market is two-speed, flat in Auckland but strong elsewhere. There is plenty of cash looking for a yield. Some of it is finding its way into commercial property, causing a shortage in many regions. Retail remains a tough gig, with margins squeezed and difficulty pushing through price increases to the end consumer. However, there were exceptions: hospitality food and beverage prices are seeing some upward pressure, as are some wholesale prices. The services sector remains in good heart, as does agriculture, with climatic conditions improving over autumn and most commodity prices strong. Something of a gold rush is going on in kiwifruit and avocados. Tourism continues to boom, as does forestry. The labour market remains tight, and there is concern evident amongst business customers about the knock-on impacts of the increase in the minimum wage."
FARM DEBT MEDIATION BILL PASSES FIRST READING
NZ First's Mark Patterson is "delighted" a member’s bill designed to provide additional protection for financially stressed farmers has passed its first reading in Parliament. If passed into law, the Farm Debt Mediation Bill will require independent debt mediation before a receivership can start.
MORE DEBT, MORE FOREIGN OWNED
Data out today from the RBNZ shows gross government debt up +$0.5 bln to $82.2 bln. And the proportion of that debt held by foreigners is also up, now at 54.9% (up from 54.0%).
AUSSIE PAY GAINS
In Australia, their hourly rates of pay rose +2.6% in the year to March, but only +2.1% if bonuses are excluded. That's the second weakest rise in 20 years. Bonuses make up a larger portion of private sector pay than public sector pay across the ditch.
DOWN, BUT NOT OUT
Japan's economy shrank in the first quarter of 2018 for the first time in two years, ending the longest stretch of economic growth since the 1980s. The world's third largest economy contracted at an annualised rate of -0.6%, official data showed. Weak consumption came at a time Japan's export engine is in transition. The weakness is not expected to last long. Japan is the world's third largest economy (impressive for a country about the size of New Zealand and an ageing workforce. Their GDP per capita is about +11% higher than ours.)
INSULTING A NEIGHBOUR
A photo of Chinese tourists wearing T-shirts depicting Beijing’s claims to the disputed South China Sea has sparked online anger in Vietnam, prompting calls for the visitors to be deported. The shirts featured a map of China and its so-called nine-dash line – the sea boundary found on some 1940s-era maps which Beijing says proves its claim to most of the waterway, despite claims from Vietnam and other nations to their adjacent seas.
BENCHMARK INTEREST RATES JUMP
Local swap rates rose strongly and steeply today following Wall Street higher. The two year is up +2 bps, the five year is up +3 bps, and the ten year is up +5 bps. On Wall Street, the UST 10yr yield rose in trading to 3.09% but has since fallen back to 3.06%, a +6 bps gain on the day. The Aussie Govt 10 yr is now at 2.87% (up +5 bps). The China 10 yr is at 3.73%, unchanged. And the NZ Govt 10 yr is up +8 bps at 2.83%. The 90 day bank bill rate is unchanged at 2.01%.
The bitcoin price is at US$8,165 which is a -5.9% drop from this time yesterday.
NZ DOLLAR UNCHANGED
The NZD sunk from yesterday on a strengthening USD, but within the past hour the greenback has been bid down sharply on revived tensions in Korea. The NZD is now at 68.7 US. We are a little stronger against the Aussie at 92.1 AUc, and at 58.1 euro cents. That has the TWI-5 at 71.6 and little change overall from this time yesterday.
This chart is animated here. For previous users, the animation process has been updated and works better now.