A review of things you need to know before you go home on Wednesday; no rate changes; food prices lower, hotel occupancy rates hold; KiwiBuild 'popular'; swaps unchanged, NZD stable

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

MORTGAGE RATE CHANGES
No changes to report today.

TERM DEPOSIT RATE CHANGES
None here either.

HEALTHY EATING CHEAPER
Food prices were virtually unchanged in May from the same month a year ago. But you would hardly know that given the Stats NZ story-line put out about the rise in avocado prices (which they probably did to use the word 'smash' in their headline). Ignoring that, actually fruit and vegetable prices were down more than -10% year-on-year, meat-poultry-fish prices are unchanged as are grocery prices (and our own tracking confirms that). But beverages are up +4.6% and eating out is up +2.9%. Bottom line, eating healthy is cheaper than a year ago. Except for those pesky avocados. There are 1,350 avocado growers with over 4,000 hectares in production; they can't keep up. It is our third largest fresh fruit export ($80 mln / year) and we have yet to get access to the Chinese market.

TOURISM DATA CONFUSING
Data on tourist guest nights for April has been 'spoiled' by the timing of Easter 2018 compared to Easter 2017. Seasonal adjustment techniques aren't applied to this data and it isn't certain they would have handled this situation well anyway. But a sniff test suggests that the momentum is still there, with the overall occupancy rate hanging at its recent high levels for an April.

BIG TENDER, FEW WINNERS
The LGFA tendered $150 mln in four separate maturities today. Overall, this received bids for $375, a 2.5x coverage ratio. But only nine bidders won these tenders. The weighted average accepted yield was 3.35% with comparable maturities bringing just marginally lower yields.

'POPULAR'
The Housing Minister says 'almost 100' proposals have been received from developers in response to the Kiwibuild 'Buying off the plans' tender. He calls that 'overwhelming', but releases few details.

UPDATED
Our KiwiSaver analytics (using our unique regular savings methodology) is now updated through to May, 2018. Find your fund here.

A TOP INSULT FOR HOSTS
You know American foreign policy is being managed by the very best brains they have when their Secretary of State declares that the US-North Korea talks will been held in "Singapore, Malaysia". This Administration really knows what it is doing, right down to the details.

BENCHMARK INTEREST RATES UNCHANGED
Local swap rates are virtually unchanged today. The UST 10yr is now at 2.97%, up +1 bp. The Aussie Govt 10yr is at 2.79, down -2 bps, the China Govt 10yr is at 3.69% (unchanged), and the NZ Govt 10 yr is at 3.03%, up +2 bps. The 90 day bank bill rate is unchanged at 2.00%.

BITCOIN IN THE DUMPS
The bitcoin price is clawing its way out of the US$6,456 hole it fell into this morning and is now at US$6,565 which is down -4.3% from this time yesterday. Prices at this level are just one third of the peak it reached on December 17, 2018.

NZ DOLLAR BECALMED
The NZD is virtually unchanged from where we opened this morning, now just on 70 USc. We are at 92.6 AUc and at 59.6 euro cents. That has the TWI-5 still at 73.

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USD 
NZD
End of day UTC
Source: CoinDesk

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32 Comments

I guess the Secretary is only 50 years out of date!

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Got to like the Singapore, Malaysia quote. Americans do seem to get a bit confused when outside their home town. Still, much as I hate to admit it, Trump and Kim may be making history. Nixon looked like a complete idiot at the time, but he brought China into the modern world. Likewise, Reagan seemed a complete cowboy but ended up bringing down the Berlin Wall. Blair seemed such a nice young man, but enabled destabilisation and endless blood letting in the Middle East. Strange indeed. I suppose GW Bush seemed an idiot and still looks that way to this day.

I think this is the american version of , Yes , Prime minister. I would say this deal has been worked out by the 2 administrations before the "summit". Perhaps the giveaway was Trump saying he would know within a minute wether they could do a deal or not. At first , it looked like arrogance , now I think it looks like he knew the deal was already done. Im other words the Administrations will use the ego of Trump , and in this case Kim , do get things done. As long as Trump can take the credit , he will be happy.

Speaking at his Mar-a-Lago resort on Tuesday, Trump appeared to allude to the extraordinary face-to-face meeting between Kim and Pompeo when he said the United States has had direct talks with North Korea “at very high levels.” The president didn’t elaborate at the time.

https://www.washingtonpost.com/politics/us-china-trade-dispute-looms-ove...

Trump met when he went to China. It's there for all to see

If Trump can type that fast and print it..I for one would be very surprised.

All talk no action...as per usual. He just likes the credit...it is what he lives for. (USA norm)

Look at me.....Look at me.. A sign of the times....indulgent pairing.

With all this rain when will NZ start to dissolve?

We're just one big mudslide.

Good news – the days will soon become longer, spring is but months away and dissolving is a reversible change.

Interesting to see where the BNZ Kiwisaver funds rank now that they have been operating for more than 5 years. Growth and Moderate funds rank highly in their categories. Cash, Conservative, and Balanced not so much.

NZD was lower this morning than this afternoon when I checked.

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Very entertaining video of Harry Dent talking about the recent incarnation of the property bubble and the expectation of houses to appreciate in price more than people can earn and how it influences bubble behavior. Released only a few days ago. NZ gets a few mentions.

https://www.youtube.com/watch?v=vKZnyzeLO2s&t=14s

Ecobird, TTP and double-gz would do well to watch this and learn!!!

Its right on the money!!

OMG wtf?!? I bought mine between the 90's and early 2000's with a very low mortgage to serve, and I am not planning to sell in the next 20 years. I live in my family home which is mortgage free and I get my income from my Mon-Fri job and rentals. How am I affected by this so called 'bubble' if it indeed exists??

DGZ, your telling porkies. Two negative geared rentals caused you to comment 29 March about one less refund check, once Ring Fencing comes in. At the same time you also pointed out you had a mortgage free home. https://www.interest.co.nz/property/92896/ird-releases-ring-fencing-pape.... When I went back to check the post, you had deleted it 01 May, after I called you out for the same lie on yet another occasion!

It's no big deal either way to me but for the sake of your own credibility and your ever growing nose, stop telling porkies!

Yeah, and weren’t you supposed to send me a pic of your tumescence and your refund cheque!? You are breaking the trust. Don’t make me beg.....

#sadpropertypornaddict

Liar liar pants on fire RP! There was never a refund cheque from the IRD. You're making up a dream DGZ story by the look of it, you should be a movie director ^^LOLdgz^^

DGZ, you have been sprung for telling porkies and you know it - ha-ha-ha-ha :) Only you could have deleted the post! Oh, you do provide some entertainment!

Enjoy your evening :)

How childish RP! You acted like a 5 yo kid...bed time for you! See ya see ya later, it's time to say good night!

Yeah, nah, you talked about a tax refund cheque, I assumed it was for negative gearing. This thread at 22 March 20.17 pm. I asked you for a special picture....

Not that I care either way, but that’s what you said....whatever

https://www.interest.co.nz/news/92778/housing-minister-has-introduced-tw...–-ban-letting

A refund cheque because IRD overcharged me for my student loan for goodness sake ^^LOLdgz^^

Lolz

.

lolz :)

well you continually go on about how your part of town is not effected by the downturn, it seems that the more affluent areas may end up getting hit worst when this boom turns to bust.

Hope all your retirement eggs are not in the same basket

You think anything short of a clue-by-four is going to knock sense into them? I guess you aren't a real DGM, cos thats a very optimistic opinion.

If I can help one stupid person become just a little less stupid then I have contributed to the enhancement of mankind.......

Another Wealthy Investor immigrant category sentenced & jailed
https://www.nzherald.co.nz/business/news/article.cfm?c_id=3&objectid=120...
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Can Immigration be charged with negligence as well?
Can NZers please see the full trace of how he infiltrated NZ, who approved his visa applications, who else was involved, which people and companies sponsored him, the full history, so NZ can learn for the future.

When is the NZD going to get dumped? We don’t have the comparatively high interest rates we used to, so why is our dollar still so high?

Q. 'When is the NZD going to get dumped?

A. 'Just before the Prom, which is when Fed raises to 2.25%...' by then, enough of the dirty laundered money we've been hiding will have been exposed to the markets and while we may have been deemed to be 'a good Friday night Shag - or possibly even a good holiday away' we will also be deemed as being too dirty to take to the Prom and definitely too dirty to introduce to your Mom!

The purchasing power of the NZD is already pretty low. The NZD will start going down again when there is more desire to sell our currency than buy it. This can be caused by many, many, many things.