A review of things you need to know before you go home on Thursday; rates cut, ministers try to change Fonterra management, ComCom suggests Fonterra paying to much for milk, NZGB demand soft, swaps & NZD stable

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

MORTGAGE RATE CHANGES
ASB has cut rates on its three most popular home loan offers.

TERM DEPOSIT RATE CHANGES
NZCU Baywide has cut its rates by -10 bps for terms 18 months to 3 years.

MEDIAN RECORD
Residential property sales rose strongly in May and prices were also firmer says the REINZ. But that was not the case in the largest market, Auckland; prices there are still at levels first seen in September 2016 and volumes sold were only +120 more than the same month a year ago but -24% lower than for May 2016. The national data was boosted by momentum in the provinces and drag in Auckland and Christchurch.

SAY, WHAT?
In timing that is rich in irony, a headline-grabbing Government minister is criticising Fonterra aggressively for essentially not delivering good enough returns for farmers. And the Commerce Commission has launched an investigation into Fonterra on the basis that it has been paying too much to farmers for their milk. Maybe the Ministers and the Commission should have met first to iron out which one it is.

COMPETITION SCRUITINY
The Commerce Commission has opened an investigation into Fulton Hogan proposed acquisition of Stevenson Group construction materials business. A key focus will be on the potential competitive effects of the proposed acquisition on quarry markets in Auckland and North Waikato.

FADING DEMAND
The latest $200 mln tender for 2025 NZGBs saw the yield rise to 2.60% and the coverage rate 2.2x, its lowest level in the last nine auctions for this bond. There have been 22 auctions of the 2025 bond and 19 of them have have stronger demand than today's.

PRICED
The new $100 mln fixed rate notes from China Construction Bank will pay 4.005%. They will be rated A by S&P.

BANKRUPT BUILDER JAILED
Bankrupt Auckland builder Li Dong Xie has been sentenced to three years and four months in jail for multiple breaches of the Insolvency Act. Xie (also known as Lidong Xie, Frank Xie and Solomon Xie) was bankrupted 2010 and last month pleaded guilty to 10 breaches of the Insolvency Act after he continued to run his business illegally and gambled away more than $1.5 mln in earnings on pokie machines at Sky City Casino, money which should have gone towards repaying his creditors. The charges he faced included acting as a director of a company without the consent of the Official Assignee (OA), obtaining credit, failing to file a Statement of Affairs and attempting to leave the country without the consent of the OA.

LESS SEEK WORK, MORE GET IT
Australia's unemployment rate fell to 5.4% in May, but fewer people sought work. Still the jobless rate beat market expectations. Employment grew by +12,000 but that was well under market expectations of +19,000. The participation rate dropped however to 65.5%.

WHAT CEOs WORRY ABOUT
A new survey has revealed Kiwi businesses expect technological change and an ageing population to have more impact on their operations than globalisation or the rise of Asia. Of the nine ‘global megatrends’ identified in the Chartered Accountants Australia and New Zealand, nearly a quarter (24%) rated technology as having the biggest effect. At the other end of the scale, climate change and resource scarcity were picked to have the least impact (each 7%). The ageing population (16%) was also on many business leaders’ minds. Like climate change and resource scarcity, growth in Asia (8%) was low down on the list.

GOING SOFT
Some key data out of China has come in soft today. Retail sales sagged far more than expected. And industrial production data also come in lower than expected

BENCHMARK INTEREST RATES UNCHANGED
Local swap rates are basically unchanged today although the 10yr is down -2 bps. The UST 10yr is now at 2.97%, unchanged, even after the US Fed hike. It was clearly all priced in. The Aussie Govt 10yr is at 2.74, down -5 bps, the China Govt 10yr is at 3.70% (up +1 bp), and the NZ Govt 10 yr is at 3.01%, down -2 bps. The 90 day bank bill rate is down -1 bp to 1.99%.

BITCOIN DOWN AGAIN
The bitcoin price is now at US$6,419, down -2.2% from this time yesterday. At one point in the past 24 hours it got down to US$6,146 and its lowest level since October 2017.

NZD LITTLE CHANGED
The NZD is similar to where we opened this morning, now just on 70.2 USc. We are firming against the Aussie at 92.9 AUc and at 59.5 euro cents. That has the TWI-5 still at 73.

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