A review of things you need to know before you go home on Friday; Kiwibank cuts a mortgage rate, dwelling consents hit capacity limits, REINZ warns, swaps drift up, bitcoin tanks, NZD says firm, & more

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

MORTGAGE RATE CHANGES
Kiwibank has announced that its 2 yr fixed home loan 'special' will be reduced -10 bps to 4.19% on Monday.

TERM DEPOSIT RATE CHANGES
We corrected a minor error in the FEI rates listed in our tables today.

A CAPACITY ISSUE?
The level of dwelling building consents issued in November was disappointingly tame, and fell noticeably in Auckland. Infometrics suggests the Auckland pullback is "pointing to a lack of additional labour, materials, land, and finance to grow new dwelling approvals further". Consent level in the lower part of the North Island, and Nelson, were strong however.

NON-HOUSING CONSENT LEVELS JUMP
The growth in non-residential consents was much stronger than expected in November, particularly for education and "social, cultural and religious buildings". Capacity constraints in Auckland remain a barrier to future growth and also begs the question as to whether this recent growth in non-residential consents is sustainable.

LAST CALL
The REINZ warns landlords they have less than 6 months to insulate rental properties or face a $4,000 fine

CELEBRATING SURVIVAL
The Aussie retail sector is celebrating that its November sales rise beat estimates. But I hate to tell them that the data is still very weak. The bar was set low with an October-to-November estimate of a +0.3% seasonally adjusted gain. They actually got +0.4%. Year on year the gain is just +2.9% and they have a +1.9% inflation rate. Still, it is a gain and in today's world of retailing, I suppose that is worth celebrating. Victoria is the standout (+5.0%) while South Australia the laggard (+1.5%).

GOTCHA
And staying is Australia, Virgin Money has slapped a big +20 basis point out-of-cycle rate hike on its home loan customers. Ah, the perils of floating mortgage rates.

DIRECTIONLESS
At the end of the week in equity market trading in our timezone, most indexes are ambling into the day in a narrow range. There is no data or background news to drive any significant shifts. The biggest mover is the NZX50 which is up +0.6% near its close.

SWAP RATES DRIFT UP
Local wholesale swap rates have drifted marginally higher today, off the record lows we saw at the short end yesterday. The UST 10yr yield is unchanged at 2.73% after sinking earlier. Their 2-10 curve is just under +17 bps. The Aussie Govt 10yr is at 2.32% and down -3 bps today, the China Govt 10yr is unchanged at 3.14%, while the NZ Govt 10 yr is at 2.37%, and down -6 bps since this yesterday. The 90 day bank bill rate is unchanged at 1.93%.

BITCOIN TANKS
The bitcoin price is -10% lower than this time yesterday, now at US$3,618. It slumped in two separate periods earlier today, as speculators unwind bullish bets. But because there are just two discrete sharp falls, that suggests two big players have exited rather than a range of smaller ones.

NZD HOLDS
The Kiwi dollar is holding its level in light trading at 67.9 USc. On the cross rates the Aussie dollar is doing better than us so we have slipped slightly to 94.4 AUc. But we are up to 59 euro cents. That puts the TWI-5 marginally higher at 71.8.

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 or click on the "Register" link below a 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.

10 Comments

"Leading the way forward, meaning downward, is China. The Chinese economy in 2017 was practically begged to be the centerpiece of globally synchronized growth. As 2018 rolled onward, it became increasingly clear it hadn’t and wasn’t ever going to. As each month flips on the calendar, there are only indications of bad things just ahead.

Today, China’s CPI was reported to have fallen below 2% again in December 2018. This despite a relatively high (for recent times) rate of food inflation. In the West, consumer prices overall are pushed around by oil. In the East, by food. Thus, given 2.5% in food price inflation a 1.9% headline (down from 2.2% in November, and 2.5% in October) is somewhat concerning."

https://www.alhambrapartners.com/2019/01/10/rate-of-change/

Let’s not forget the Italians who have already bailed out a bank under their new coalition. 4th bail-out in 2 years.. and Germany who are on the cusp on entering a technical recession... Dare I add -despite increasing their population with immigration over the last few years...

Hope you had a good Christmas AJ. 2019 is going to be very interesting.

Best wishes

Nic

Almost half of all current jobs will become obsolete in just 15 years, according to one of China’s leading experts in artificial intelligence (AI).
https://www.nexusnewsfeed.com/article/science-futures/half-of-all-jobs-w...

Happy New Year everyone....AJ.....ETC.

I cannot wait for AI to take over Government and Politicians and Finance, so we can return to sanity, not stupidity.

(I will not mention over priced Housing ...just yet...it is too early in the New Year...that would be too stupid for words))

I used to work in AI, making businesses more economical, more sensible, more common sense, but I see little common sense in most countries, due to what I call "Corruption of Systems" in favour of the Inflation of others egos., profits and expenses. ...by firing ..."People"

It would be simple to program sensible long term AI to stop some fiddling the books, instead of providing sensible, long term productive and beneficial and economic reality, for decades to come.

But then, I am not a member of the need for stupid State and STUPID Capital expansion for ever and a day.

If one does not start at the Top, start fixing the major problems, then AI will just produce more Profits for some, not common sense for others, at the lower levels of existence....

Millions are easy to make, You just have to work around em....then retire...when enuff is enuff.

Populations...and infinite expansion, a different story. I am 'afraid' if things continue to ruled by other measures.of things ...fiddling the books and keep taking and making the tablets, has not created a better world except for storing more books and things to Google...per head of Population...right or wrong.

Maybe we should concentrate on feeding the World, via AI...as an alternative...not bloody over priced Houses....in 2019. Oooops...there we go...again.

Man will be pleased...humanity, not so much.

When you talk of A.I. do you mean
1. Super-fast Computers using all available data/info to then produce a result within bounds programmed by humans . ie
2. Computers starting at 'zero' to build their own programs that the computer chooses
3. Something else ?

Sorry if the question is not clear, I find it hard to put into words

Google this....artificial intelligence.

Some Computer can now learn from each other...but you have to start with a human mind programming correctly otherwise it is like an idiot being taught by a politician...just get bigger and bigger idiots.....and computers can do things in nano seconds, but Politicians cannot fix things when in Power up mode for decades....even Centuries.

Hence why I despise.em........Talk big ,..................achieve little.

Computers should be used for good...but bad programmers, like Bad Politicians,...would create more wars and scams and espionage....and no walls would be safe.....than a Putin or Trump...could imagine.

We are spied on Daily....just imagine, an Artificial Intelligence War....It would be worse than the Financial wars we have at the moment.....Ask any Brexit or Yankie twitter bug President, Depends on what you type in.......garbage out.

Hacking....in AI, would be the main issue....Some people like to steal intelligence.....and ruin it for others...

]

Yea I agree with what you said . When I started to see Putin more favorably / seriously

https://www.youtube.com/watch?v=2kggRND8c7Q
https://www.businessinsider.com.au/putin-believes-country-with-best-ai-r...

Who'd be a bitcoin junkie? 10% in a day - make or break you.
I like the links Andrew. I keep reading them in the hope that one day I might understand them.

I tend to keep a couple of them tabbed in my browser so I can switch to them when colleagues come around in hopes they think I’m smart because I’m looking at some seriously volatile graphs.