A review of things you need to know before you go home on Thursday; new mortgage offer, more beneficiaries, NZGB tender popular, GST for offshore online purchases, swap rates flat, NZD soft

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

MORTGAGE RATE CHANGES
Basecorp Finance is now offering Prime floating mortgages from 6.45% for terms from 3 to 30 years. This new mortgage offer is only available via brokers.

TERM DEPOSIT RATE CHANGES
No changes to report here.

MORE UNSUCCESSFUL JOB SEEKERS
There has been a noticeable jump in the number of people on a benefit, with the overall number rising to 284,300, the highest since March 2017. The driver is the +7.5% pa jump in people on Jobseeker benefits. All other main categories fell. In addition, another +24,500 people are on NZ Superannuation, a rise of +3.3%. There are now 2.5 workers per adult beneficiary, or 2.0 workers if you include people on WfF tax credits. These levels have been stable for two years now.

HEAVY BIDDING FOR LOW YIELDS
$526 mln was bid today for the $150 mln of April 2037 NZ Govt bonds that were tendered. The yield achieved was 3.0%, similar to the previous auction.

GST ON ONLINE GOODS FROM OVERSEAS
The Government is proposing a law change to require overseas retailers selling goods to New Zealanders online to start paying GST; However, the change won't necessarily cost online shoppers more because some current border processing fees will be removed.

DEBT COLLECTOR WARNED
Debt collector Intercoll Limited has been warned by the Commerce Commission for likely breaching the Fair Trading Act when it told a debtor that if she wanted to question her debt she should contact the company to which she originally owed money. The debtor was told that she needed to pay Intercoll the disputed amount, and if the dispute with the original lender was successful, then Intercoll would pay the money back. This was incorrect because Intercoll had purchased the debt and the debtor should have been able to dispute the debt direct with Intercoll.

MALE MAJORITY
The Prime Minister's Business Council has been named. They are Christopher Luxon (Chair) from Air New Zealand, Peter Beck from Rocket Lab, Barbara Chapman, ex ASB CEO and now Genesis, Jacqui Coombes from Bunnings, Anna Curzon from Xero, Andrew Grant from McKinsey, Miles Hurrell from Fonterra, Bailey Mackey from Pango Productions, David McLean from Westpac, Joc O’Donnell from HW Richardson, Gretta Stephens from Bluescope/NZ Steel, Rachel Taulelei from Kono, and Fraser Whineray from Mercury. That is a group of 13 of which five are female business leaders.

BIG GAINS
Australia's jobless rate fell sharply in September, down to 5.0% s.a. (or 4.9% actual) from 5.3% in August. This is a seven year low. Their participation rate was little changed at 65.4%. The number of new full time jobs rose +20,000 from August and up +218,000 from September 2017. The number of part time jobs fell -15,000 from August, and rose +63,000 in the year. The result generated a jump in the Aussie dollar.

BOOMER WANTS TO PULL UP THE LADDER
A New Zealand First Member’s Bill drawn from the ballot today proposes a change to NZ Superannuation entitlement by raising the minimum residency from 10 to 20 years, after age 20.

MORE RED INK
The Shanghai equity markets are down -2% in late morning trade. This is in sharp contrast to most other markets. Shanghai is now down -11% since the beginning of October. By definition this is still 'just' a significant correction. At -20% it becomes a bear market. And maybe it is a full bear market in China because it is down -22% from late May and down -42% from the start of 2018 (its recent high). Update: For the record, Shanghai closed down -3% on the day.

SWAP RATES FLAT
Swap rates are little changed today. They are up +1 bp for most durations. The positive tone from the US Fed minutes has boosted the UST 10yr yield by +5 bps to 3.21%. The UST 2-10 curve is now +31 bps. The Aussie Govt 10yr is at 2.74% (up +2 bps), the China Govt 10yr is at 3.61% (down -3 bps), while the NZ Govt 10 yr is at 2.72%, and up +1 bp. The 90 day bank bill rate is up +1 bp to 1.90%.

BITCOIN HOLDS
The bitcoin price is pretty much unchanged at US$6,514.

NZD SOFTER
The NZD is lower by -½c and now at 65.4 USc. On the cross rates we softer at 91.9 AUc, and 56.9 euro cents. That puts the TWI-5 down to 69.6.

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30 Comments

AirNZ International lounge has a reasonable population level today! Lol
(Maybe this could be used as an economic metric like the Truckometer)

It's the winding up of the Residential Housing Sales Expo.

Complaints against JLR at a reasonably high level today!
( maybe this could be used as an economic metric like something that rhymes with Truckometer)

#MeToo

National unsold housing stock continues its climb from 35,431 yesterday (Real estate.co.nz) to 35596 today, a rise of 0.47% in 24 hours
Auckland unsold housing stock has also gone up from 13,355 yesterday (Real estate.co.nz) to 13,412 today, a rise of 0.43% in 24 hours
Auckland rental offerings (trademe) back up again from 4087 yesterday to 4097 today, but still lower than Tuesday's levels.

More and more it would seem that Chinese money and influence comes under tighter and more intense pubic/official scrutiny than ever before.

The freewheeling Key inspired days of anything goes in our rock star “open” economy are perhaps finally over.

Can only guess as to what impact it will have on various markets – but I’d like to think that the housing market at least will become more a reflection of local supply/demand pressures than hot, questionable money looking for a place to hide.

Custard - Is it all money looking to hide or is a lot of it leveraged speculation on asset price appreciation. Shanghai stock exchange fell 2.94% overnight. It's interesting that the very recent crash they've had has arrived shortly after Mr Munger's warning to them about gambling.

https://www.youtube.com/watch?v=S-cvXSYH5BU

"There has been a noticeable jump in the number of people on a benefit"

I own motels and we have chronic difficulties in hiring cleaners. It's by nature, a part-time job, the units have to be finished by 2pm (which is earliest check-in time). Most applicants want to do the job just enough hours to keep WINZ off their back and they don't last more than a few weeks, the time it takes to train them properly…

I also own a hostel where we offer long-term accommodation. Sadly we have stopped accepting people from WINZ despite the guaranteed income. We had just too many problems with alcohol, bad behaviour, stealing, damaging property, being a nuisance to other good guests…

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25

Slightly off-topic but please tell me:
How is it that the media are so fosussed on the personal animosity between Simon Bridges and Jami-Lee Ross when we have just heard strong evidence that the Chinese CCP have recently attempted an attack on NZs sovereignty by attempting to purchase 2 chinese MPs - presumably agents of the Chinese govt - (because that's how they operate)?
Does the media think this Chinese gentleman was willing to make such a big donation because he just wants to see diversity in our MPs?
Where is the outrage that Simon Bridges and perhaps other leaders in the national party might have been willing to sell NZ governance to China for as little as $100,000?
Does this fit the description of sedition?
This all comes soon after we learned of possible Chinese burglaries of the home and office of professor Anne-Marie Brady who investigated the Chinese govts. campaign of influence on NZ.
Also, if it is concluded that the donation was in exchange for a service there will presumably be GST to be accounted for and maybe other tax law issues.

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The truth is hard to bear, so many and even much of the media would rather not face this reality.

https://teara.govt.nz/en/1966/capital-punishment

This was abolished in 1987, the last crime to have a capital sentence removed. Lucky for some I guess.

I think we were all wrong to assume supporters and members of a party called 'NZ National' would be more nationalistic than being led by a person with no integrity.

What worries me is there seems to be no concern for the effect of the publicity and animosity on someone who reportedly has mental health issues .

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I agree!!!

What do the die hard Nat supporters on this site think??? You guys happy with this???

From my POV we allow migrants here to become kiwis, attempts to infiltrate our political parties by bribery makes me sick!

Cant help feeling the Chinese think they dont have to answer to anyone! Totally corrupt!

This has been going on for year s and years where was the MSM?

This all comes soon after we learned of possible Chinese burglaries of the home and office of professor Anne-Marie Brady who investigated the Chinese govts. campaign of influence on NZ.

Perhaps I'm being optimistic but I am hoping that if that investigation - which Interpol were also involved in - does find the burglaries were done by CCP agents or associates - that that will be the time when the coalition government does finally take some action on all this.

Anne-Marie Brady has set out those actions she believes our government should be taking in one of her papers.

Didn't John Key take a $15 million donation from the Chinese government when he sold his house in Auckland after 9 hard years of serving Aotearoa (land of the white but slightly yellowish cloud?)

The media has been purchased by those that have the most to lose in the coming recession.

A closer look at the Australian unemployment data released today with an underemployment lens reveals a less rosy picture.
Total hours worked across Australia up 1.8% over the past year. However, with total employment up 2.4%, hours per person continues to decline. The much-awaited "around the corner" wage growth is still a while away.

The Prime Minister's Business Council appears to be missing John Key and Jenny Shipley... just minor oversights, how sad(not).....

That NZ super entitlement bill is the big new of the day for me!!!!! Bring it on.

Absolutely, if it gets passed. That would require the COL to support it. I can't see much chance of that when it would affect their voter base.

Isn't it a NZ 1st bill ?

Yes, but I'd expect few migrants to vote for them. Labour and the Greens would see more impact.

Great idea. However it would be unfair if retrospective so it would only apply to future residents therefore 20 years before it had any impact. Also concern about Kiwis working abroad. Also some adjustment for those (like myself) with a foreign pension - it always struck me as being arbitrary that my UK super is topped up by NZ but if I had arrived a year later I would have had no NZ component. In other words a good idea but the devil will be in the details.

'concern about Kiwis working abroad' .
Most Kiwis working overseas are accumulating super funds as per in Australia at 12% of income.
While welcoming these people home, we shouldn't have to pay for their retirement as well as their early years/education when they have dedicated their working/productive lives to another country.
Australia does very well out of NZ due to this very arrangement and still has the cheek to send back the small proportion of the cohort that goes rogue.

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The country should set up regional banks and get them to lend mostly to business. 15 million each to get started, fractional lending. Job done the rest of you can go home.

That intellectual and financial pygmy Cullen had the opportunity to purchase The National Bank and use its local earning to help fund the Super Fund and retain its earnings and taxes in NZ but he either didn't see the opportunity or did't judge it a good move, in either case he was just plain wrong and his tax working group recommendations just as likely to be wrong.

I see we are back in the red again....

Is this a red letter day....??...is pumping and dumping the only solution......What happens when we get a new Bank....will it invest offshore or onshore.....will it pump beyond all means...or just their customers.

https://www.marketwatch.com/

"BOOMER WANTS TO PULL UP THE LADDER"

Well, I've been watching politics pretty closely for 20 years now, and pretty sure thats the first NZFirst proposal/bill I've ever thought is a great idea!