A review of things you need to know before you go home on Monday; a TD cut, and a savings account review, retail sales firm, rural property weak, jail for advisers, swaps slip, NZD up, & more

A review of things you need to know before you go home on Monday; a TD cut, and a savings account review, retail sales firm, rural property weak, jail for advisers, swaps slip, NZD up, & more

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

MORTGAGE RATE CHANGES
Again, no changes to report today.

TERM DEPOSIT RATE CHANGES
NZCU Central cut most term deposit rates today. And we have reviewed bank savings account rates and found quite a wide variance between bank.

ONE GOOD QTR, BUT SLIPPING GROWTH
Stats NZ released its December quarter retail sales data today. A smallish gain was expected but in the end the rise was more than those modest expectations. Despite that upside, the retail data shows a sector in a downward growth trend. For the December 2016 to December 2017 comparison, the growth (excluding cars and fuel) was +6.2%. But the latest comparison on this basis is only +4.9%. For all of 2018 vs all of 2017 the decline is to +4.3% from +4.7%. Holding the overall data up is online retail and pharmacies; pushing them down are supermarket and liquor store sales. (Higher petrol prices during most of this period pumped up the overall sector levels too.) But even at these lower core levels, the retail sector is still in expansion, so it is not all doom & gloom.

JANUARY RURAL PROPERTY SALES WEAK
Farm sales and prices have been up over summer generally but the lifestyle block market is cooling, particularly in Auckland and Waikato. In January alone, farm sales volumes were -8.0% lower than January 2018. Lifestyle block sales were down -8.4% on the same basis.

LIMIT ON BANKING OMBUDSMAN CLAIMS RISING
Banking Ombudsman Nicola Sladden has confirmed the upper limit on what customers can claim from banks via the Banking Ombudsman Scheme will rise to $350,000 from $200,000 in April. She says the scheme will be able to award compensation of up to $350,000 for direct financial loss or damage, as well as up to $9,000 for inconvenience, stress or embarrassment. Commerce and Consumer Affairs Minister Kris Faafoi has approved the change. It’s the first increase since 2007. See background here.

JAIL TIME FOR THEIVING ADVISERS
Two men have been sent to prison at Tauranga District Court on charges brought by the Financial Markets Authority. Robert Ian South was found guilty of two counts of theft by a person in a special relationship, under Section 220 of the Crimes Act 1961. Murray Byron Provan was found guilty of two counts of obtaining by deception under Section 240 of the Crimes Act 1961. Both men were convicted by a jury in December 2018. South and Provan received a total of $645,000 from the two investors. $40,000 was returned to one of the investors. Both men received the same sentence: 4 years and 6 months. You can see how this sentence compares here.

MORE TAXES ON BANKS COMING
In Australia, the opposition Labor Party seems to have survived unscathed in the polls over its border protection stance. That increases the likelihood that it will be the new government in May. Today Labor will announce plans for a new levy that would raise AU$160 mln a year over four years, targeting any financial institution in the top 100 companies on the ASX. That obviously includes the four major banks, but also a number of smaller, regionally focused one. This Labor one is in addition to the one the Turnbull Government instituted that raises AU$1.5 bln per year. (ANZ paid AU$355 mln, CBA paid $369 mln, NAB paid "about" $400 mln, and Westpac paid AU$378 mln in 2018. These total AU$1.5 bln for the year.)

'BANKS ARE BAD - EXCEPT MINE'
Despite all the bad press, Australian bank customer satisfaction levels have held steady in 2018 and well above the long term average. For the sixth year running, the CBA has claimed the Roy Morgan customer satisfaction crown, driven in particular by strength in mobile and internet banking satisfaction.

PUTTING IT OFF
The Trump Administration has formally delayed their March 1 tariff hike on Chinese imports. What concessions either side has conceded isn't clear yet. The NZD is rising.

SWAP RATES
Local swap rates are -2 bps lower today for the two year duration, down -1 bp for the five and 10 year. The UST 10yr yield is up +1 bp at 2.66%. Their 2-10 curve is holding at +16 bps. The Aussie Govt 10yr is down -1 bp to 2.08%, the China Govt 10yr is unchanged at 3.15%, while the NZ Govt 10 yr is down -5 bps so far today to 2.19%. The 90 day bank bill rate is unchanged at 1.89%.

BITCOIN DOWN
The bitcoin price is down -3.7% from this time on Friday to US$3,757.

NZD RISING
The NZD has been rising steadily all day and is now at 68.8 USc after Friday's foolish market burp. And we are firm against the Aussie at 96 AUc, and a little higher at 60.6 euro cents. That has the TWI-5 backj up at 73.2, about where we were this time last week and about equal to its 2019 high. The US-China tariff extension is helping China-trade currencies, like the NZD and AUD.

This chart is animated here. For previous users, the animation process has been updated and works better now.

Daily exchange rates

Select chart tabs »

The 'US$' chart will be drawn here.
Loading...
Daily benchmark rate
Source: RBNZ
The 'AU$' chart will be drawn here.
Loading...
Daily benchmark rate
Source: RBNZ
The 'TWI' chart will be drawn here.
Loading...
Daily benchmark rate
Source: RBNZ
The '¥en' chart will be drawn here.
Loading...
Daily benchmark rate
Source: RBNZ
The '¥uan' chart will be drawn here.
Loading...
Daily benchmark rate
Source: RBNZ
The '€uro' chart will be drawn here.
Loading...
Daily benchmark rate
Source: RBNZ
The 'GBP' chart will be drawn here.
Loading...
Daily benchmark rate
Source: RBNZ
The 'Bitcoin' chart will be drawn here.
Loading...
USD 
NZD
End of day UTC
Source: CoinDesk

We welcome your help to improve our coverage of this issue. Any examples or experiences to relate? Any links to other news, data or research to shed more light on this? Any insight or views on what might happen next or what should happen next? Any errors to correct?

We welcome your comments below. If you are not already registered, please register to comment.

Remember we welcome robust, respectful and insightful debate. We don't welcome abusive or defamatory comments and will de-register those repeatedly making such comments. Our current comment policy is here.

21 Comments

Comment Filter

Highlight new comments in the last hr(s).

Does anyone know what sort of heating device landlords need to install for the healthy homes bill just out?some people I've talked to say heat pumps others are saying cheaper options. Could anyone clarify?

wall mounted one

Its heat pumps. No idea why normal heaters aren't good enough when most home owners use them

Power use probably. No point putting a heater in if the tenants can't afford to use it .

... yeah ... it seems ridiculous to blame landlords for their tenants being cold in winter ... how's about aiming the blowtorch of public opprobrium at the power companies , at those lords of electricity ....

The power companies aren't the ones too cheap to install decent insulation and heating devices, or fix drafty windows. Better insulation = less heating requirements, so for some installing better insulation will mean they can get away with a panel heater instead of a heat pump.

We had a heat pump installed in our home. It’s tacked on to the rates at $7 a week over 7 years or something like that.

No, its not heat pumps (although that may be the only sane option in some cases), its a fixed permanent heater that is capable of heating the room to a minimum temperature on the coldest day of winter.

https://www.hud.govt.nz/residential-housing/healthy-rental-homes/healthy...

"Some heating devices are inefficient, unaffordable or unhealthy to run, such as unflued gas heaters, open fires, electric heaters (except heat pumps) with a heating capacity of greater than 2.4 kilowatts, and multiple electric heaters (except heatpumps) in one room. These particular heating devices will not be accepted in the heating standard, meaning that while they can still be used, they won’t meet the standard and the landlord will in most cases need to provide an alternative, acceptable fixed heating device."

So besides a heat pump what could heat a lounge room to 18 degrees on coldest day of year pragmatist?and what would it cost roughly?allso to take into account the units have been all been insulated where possible.thanks in advance!!!

.

Just read your link now thanks a lot!!!disregard my questions below

If a house is properly insulated a space heater is plenty. It's laughable how many houses in NZ have heat pumps with single glazed windows and no wall insulation - it's just throwing money away.

NBoy
Like you I am not sure. However, I read that the cost of the measures (heating and under-floor insulation etc) announced over the weekend is likely to cost landlords around $7,000 which suggests a bit more than a Warehouse two bar heater.

Thanks for that Pragmatist.
Personally, this requirement is yet another factor that supports my move to get out of rental properties a couple of years ago.
Sadly, the days of sunshine for landlords are over - and this relates not only to profitability for landlords but equally the most likely rent increases as landlords pass costs on and availability of rental properties for tenants as landlords exit the property market.
I consider the Government has a very narrow, anti-landlord, view regarding rental properties and are not cognitive of the issue that they are indirectly creating for tenants.

Personally speaking the Healthy Homes requirement isn’t going to affect us, however with the ringfencing negatively geared landlords are going to bugger this and opt out of providing shelter to those that require It!
Yes the government is trying to hammer landlords and this is going to come back to haunt them as everything they have done so far has made things worse.
Look at the no.s looking for State houses, this has increased and yet Mr Twyford in his wisdom says that it is due to him flushing out people from hiding! Lol!
Classic Twyford, lets take the focus off this and KiwiBore with this Healthy Homes BS!

Some good points there. I am a KiwiBuild fan but not a Twyford fan ( KB was actually David Shearer’s idea, and it’s potential is being inhibited by awful leadership and implementation).
Twyford is all talk, he’s done little to progress his election promise of doing away with the RUB etc etc.
The Healthy Homes stuff does look like Twyford trying to distract from his epic fails. Jacinda needs to get rid of him, but replace him with whom?

Some good points.
What they are doing might be fine if they actually had a plan to pick up the slack, such as shared equity or rent to buy housing, or simply extending their reach as a landlord to provide market rental accommodation.
But they don’t, and whacking landlords without a coherent plan is going to generate unintended consequences.
I have pointed this out before but they don’t get it.

"The Trump Administration has formally delayed their March 1 tariff hike on Chinese imports."
It seems that markets are not surprised by this and seemed to have already factored this in (or see little impact). NZSX and ASX are both down slightly, and while Shanghai is currently up 2.88%, they seem to have been in positive mode for some time being up over 17% for the year and Nasdaq over 13% YTD.

Update: Shanghai now up 5.6% for the day (20.4% YTD) so confirmation seems to be having an effect in China,

... Bitcoin at $US 3700 ... it needs another GFC to breathe some life into it .... otherwise , what's to stop it continuing downwards on its death-spiral ...

Endemic market manipulation.