A review of things you need to know before you go home on Wednesday; no rate changes rents rising, corruption slip, biosecurity call, swaps & NZD stable, & more

A review of things you need to know before you go home on Wednesday; no rate changes rents rising, corruption slip, biosecurity call, swaps & NZD stable, & more

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.

RENT NOW UP TO $15.00 PER DAY
Average rents rose +$24 in 2018 to $456/week. Rent growth was very strong in Wellington and Hawke's Bay last year, but growth was slower in Auckland, Christchurch and Dunedin.

GOING DOWN
New Zealand has been knocked off its #1 position in Transparency International's corruption perception index. Denmark pipped us in this widely referred review. (And the irony is that Denmark is the home to Danske Bank, the company at the heart of the world's largest-ever money laundering scandal.)

HEARTLAND NAMES ACTING CFO
Heartland Group Holdings says Myles Perry, who has been its head of internal audit, will serve as Acting Chief Financial Officer following the resignation of David Mackrell. Mackrell joined publisher NZME as CFO in late March. Heartland says it will continue to consider its longer term requirements and provide an update in due course.

'MAKE THEM TAKE IT SERIOUSLY'
Federated Farmers are calling for airlines to run compulstory biosecurity warning videos before airplanes land. With the sharp rise in tourism to New Zealand, they are concerned MPI is relying on interception and ignoring self-compliance.

UNDER PRESSURE
Air New Zealand has advised markets that its earnings are under pressure, principally because of dud engines supplied by Rolls Royce.

MARK YOUR CALENDAR
The Aussie Federal government has announced that it will receive the final report of the Royal Commission into Misconduct in the Banking, Superannuation and Financial Services Industry on Friday 1 February 2019. Then the final report will be publicly released at 4:10pm on Monday 4 February 2019, following the close of trading on the ASX. (6:10pm NZT.)

DOING IT THE AUSSIE WAY
Latitude Financial Services, the Aussie-owned finance company that runs the Gem brand in New Zealand, has appointed an Aussie to run its New Zealand business. David Gelbak has been appointed out of Latitude's Melbourne head office.

TOLERABLE INFLATION
CPI inflation in Australia rose +1.8% pa in the year to December 2018. Analysts had expected a +1.7% rise following the year to September +1.9% rise. The result saw the AUD rise.

EQUITY MARKET BACKDROP
Earlier today the S&P500 fell -0.2% for the day. That now means a +5.3% gain in that index in 2019. Today, Tokyo has opened -0.7% lower, Hong Kong -0.4% lower, and Shanghai -0.2% lower. The ASX is even so far today, but the NZX is down -0.6%, and down led by AirNZ (down -12%).

SWAP RATES UP AT SHORT END
Local wholesale swap rates are up at the short end, up +1 bp for the 2 year duration. The five and ten durations are little changed. The UST 10yr yield is lower at just under 2.72% and their 2-10 curve is up at just on +14 bps. The Aussie Govt 10yr is at 2.24% (up +2 bps), the China Govt 10yr is down -1 bps at 3.17%, while the NZ Govt 10 yr is at 2.34% and also down -1 bp. The 90 day bank bill rate market is up +1 bp at 1.92%. And that is a +4 bps rise in five days.

BITCOIN SOFT
The bitcoin price is down to US$3,386 today, a fall of -1.0%.

NZD LITTLE CHANGED
The Kiwi dollar is unchanged against the greenback at 68.3 USc. On the cross rates we are down following the CPI result at 95.1 AUc, and we are unchanged at 59.7 euro cents. That leaves the TWI-5 at 72.3.

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USD 
NZD
End of day UTC
Source: CoinDesk

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11 Comments

More developer welfare from Kiwibuild.. https://www.nzherald.co.nz/nz/news/article.cfm?c_id=1&objectid=12198629

"One way would be to offer a stronger incentive for developers, as well as how the Government could make KiwiBuild better for first-home buyers.
"Housing Minister Phil Twyford is teasing details of his upcoming KiwiBuild "recalibration", which will include providing private developers more incentives to build KiwiBuild homes."

[...]

"The idea is to provide a package of assistance to developers that would be enough of an incentive to get them to commit to serious volumes of affordable housing year-on-year."

No real details given yet..

"Re-calibrating" = dumping the targets because they can't meet them. I would have said that was probably the most significant thing that happened today.

" the Royal Commission into Misconduct in the Banking, Superannuation and Financial Services Industry ( will be handed to Government) on Friday 1 February 2019. Then the final report will be publicly released at 4:10 pm on Monday 4 February 2019"

Someone will know what's in it within 1 minute of it being handed-over on the Friday. Trading on their sharemarket, especially in their banking and insurance company shares, should be interesting!
Given the possibilities, shouldn't the ASX suspend trading in those stocks from 5 pm Thursday until 9 am Monday, just in the name of keeping the whole market equally informed?

Yes. Australia tends to leak like a sieve when it comes to this sort of thing. I'll be surprised if we haven't heard about the contents of the report before 6:10pm on Monday...

NZ Air market pressure
Excluding the estimated $30m-$40m for “dud RR engines ” Air NZ earnings guidance before taxation is projected as $45m - $85m down from previous guidance because of…”Markets showing signs of
slower growth include leisure travel within domestic New Zealand and softening inbound tourism traffic.” and despite a projected average 5% fuel price drop.

http://nzx-prod-s7fsd7f98s.s3-website-ap-southeast-2.amazonaws.com/attac...

Mate just got tickets to NZ out of San Fran $600us return

Exactly. More to do with market pressure and price elasticity then already factored in engine problems.

House hasn't gone up by 15% this year - average boomer decides best not take the usual second trip to Europe this year. Sorry Air NZ.

They made a lot of sacrifices, worked very hard and paid taxes for decades so they deserve every cent of capital gains they get.

Maybe in light of dwindling capital gains Winston could extend the gold card to cover International flights.

They strangled the land supply, opened the arrival gates and stuck a price tag on things they got for free. Sticking everyone else with the bill is not an admirable way to enrich yourself, sorry. Pay for your own flights, I haven't been out of the country on holiday since 2010.

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