Here are the key things you need to know before you leave work today (or if you work from home, before you shutdown your laptop).
MORTGAGE RATE CHANGES
There are no changes to report today. All rates are here.
TERM DEPOSIT/SAVINGS RATE CHANGES
There are no changes here either. All updated term deposit rates less than 1 year are here, for 1-5 years, they are here.
PATCHY & CHALLENGING
The ANZ-Roy Morgan consumer confidence survey eased lower in January but it is well above is equivalent 2024 level Having said that, it is also still well below its pre-pandemic level which itself isn't a very high bar. The proportion of households thinking it’s a good time to buy a major household item, the best retail indicator, dropped sharply into negative territory. Inflation expectations were little changed but still at 3.9% which is still at worrying levels..
WATCHING THE LENDING FLOWS
Lending for housing rose +3.8% in December from a year ago, and while than may seem relatively tame, it is the highest rise since early 2023. And it is faster lending growth than for personal loans (+0.5%), business lending (+2.9%) or agriculture (+0.3%). To be fair, farmers are making themselves unbankable with their political whining and trying to use political pressure to force lenders to lend while resisting managing climate risks, and that is making lenders wary. In fact bank appetite for rural lending seems to have plateaued. But that isn't stopping banks lend to non-rural businesses which it a record $137.6 bln at the end of 2024.
HOUSEHOLDS KEEP PILING IN TO TERM DEPOSITS
As is usual in December, household deposits jumped, but the 2024 jump was more than usual and only beaten by the outsized rise in December 2021. And that put them +7.2% higher than in December 2023. Household transaction balance were little-changed, household savings balances were up +3.3%, but household term deposit balances leapt by +11.6% from the same month a year ago to more than $141.6 bln (a record high) and up +14.7 bln in the year. However the pace is slowing; in both 2022 and 2023 they rose almost +$23 bln in each year.
NZX50 UNCHANGED AFTER A DOWN WEEK
Here are the key changes to know about in the New Zealand equity market. As at 3pm, the NZX50 is on track to fall -0.6% for the week. Vista, Fletcher, a2 Milk, and Vulcan Steel top the gainers and Heartland Group, SkyTV, Precinct Properties, and Goodman lead the decliners
TURNING UP?
Japanese industrial production rose in December from November and that limited the year-on-year decrease to less than expected.
TURNED UP
Japanese retail sales rose +3.7% in December from the same month in 2023, up from a +2.8% gain in November, and better than market expectations of a +3.2% rise. This is the 33rd straight month of expansion in retail sales and the fastest growth since June 2024. Rising pay levels are getting the credit for the expansion.
HIGH BUT FALLING
Aussie producer prices rose +3.7% in December from a year ago, the slowest rise since early 2021.
TRACKING INFLATION DOWN DIRECTLY
In Argentina, their central bank cut its policy interest rate by -300 bps to 29% earlier today (Friday NZT), as inflation eased again. But annual inflation in Argentina was still at 118% in December, the softest increase since July 2023, down from 166% in November.
SWAP RATES STABLE
Wholesale swap rates are probably little-changed today on global forces so keep an eye on our chart below which will record the final positions closer to 5pm. The 90 day bank bill rate was down -1 bps on Thursday at 3.94%. The Australian 10 year bond yield is up +1 bp at 4.45%. The China 10 year bond rate has held at 1.64%. The NZ Government 10 year bond rate is down -2 bps at 4.61% while today's RBNZ fix was 4.54% and down -1 bp. The UST 10yr yield is now just on 4.53% and down -1 bp from where we were this time yesterday. Their 2yr is unchanged to just on 4.22%, so that positive curve is still at +31 bps.
EQUITIES FIRMISH
The NZX50 is up +0.2% from this time yesterday. The ASX200 is up +0.5% from yesterday and may end the week at a record all-time high. Tokyo is up +0.2% in early Friday trade. Hong Kong, Shanghai and Singapore are all closed for CNY holidays. Wall Street ended its Thursday session up +0.5% on the S&P500.
OIL ON HOLD
The oil price is little-changed from this time yesterday now just over US$73/bbl in the US, and just over US$76/bbl for the international Brent price.
CARBON PRICE IN RANGE
The carbon price is still within its tight range, but firmed again today to NZ$63.50/NZU. The next release of units at the official auction is on March 19, 2025. See our new daily chart tracker of the NZU price for carbon, courtesy of emsTradepoint.
GOLD HIGH
In early Asian trade, gold is up +US$33 from yesterday, now at US$2792/oz and a new record high.
NZD SOFT
The Kiwi dollar has slipped -20 bps from this time yesterday, still at 56.4 USc. Against the Aussie we are unchanged at 90.7 AUc. But against the euro we are down -10 bps at 54.2 euro cents. This all means the TWI-5 is now just on 67 and down -20 bps from yesterday.
BITCOIN HOLDS
The bitcoin price has flat-lined today, now at US$104,390 and little-changed from this time yesterday. Volatility of the past 24 hours has been modest at just over +/- 1.6%.
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43 Comments
Confidence down as people decide 2025 is same as 2024, I do not see much recovery in 2025, NAct does not even want to admit there is a problem, hard to fix when about 1/3 of your economy was backed by housing lending. No credit impulse = no recovery.
Less government spending must be gutting GDP as well.
Getting NZ "Back on track", has been shunted off to a quiet siding (see what i did there....)
Now its all "Growth, growth growth...." which is not a smart catch phrase unless you have a solid plan to create growth.
It's starting to bore me senseless. All this talk of pivoting away from the Ponzi - without explicitly referring to the Ponzi - is shallow, reactionary, and empty. My contempt for the ruling elite is really growing. It's little more than a pantomime: no plan, no intent, no conviction.
Bring back Jacinda. At least she didn't pretend she had a master plan.
The National Party reminds me of that stick man meme. He’s pointing a stick at an inanimate object (the economy) saying “do something”
In times as hard as these we look to our leaders for inspiration and ideas. All we get is “growth growth growth!” and “New Zealand is open for business”
What I would say to you is - NZ needs a creative and strong leader more than ever. Luxon ain’t it.
I think he could execute if there was a plan, but its impossible to create something from scratch that's, as JC says, 2/3rd of the credit in supply in your economy.... you cannot tax a loss, sorry Labour, CGT is worthless for a bit here.
He can yell business lending as loud as he wants, no security = no honey. As a Kiwi I would much rather move my funds abroad for diversified international income type fund at my age, most older people have most of the wealth, we do not want to invest in risky new businesses here. Aussie seem to have user pays roads sorted ... create infrastructure funds based in lucky country.
"No credit impulse"? Not sure where you are looking IT Guy, but I see one. And I hope it stays small. Alas, I suspect we'll see it first with silly house purchases, followed by a turn up in retail spending. By the end of 2025, sadly, we'll be doing what we always do.
I saw another report on a sectors % of GDP today. My BS meter goes off every time.
My theory is that if we add up all the totals of all the (advocates) reports on a % of GDP it will be in the thousands, lots of thousands. How is that possible. Surely GDP can only total 100%?
Do we need someone carrying out BS reporting monitoring or is my theory 🤔 wrong?
gold is up +US$33 from yesterday, now at US$2792/oz and a new record high.
Happy days for gold. Here's an interesting thing I've noticed. If you benchmark appreciation across gold, silver, gold miners in USD over the past 1 and 5 years, they're almost identical, except for one outlier.
1 year
Gold +37% / Silver +37% / Miners (GDX) +39%
5 year
Gold +75% / Silver +77% / Miners (GDX) +36%
JPM and Westpac forecasted we might hit USD2,900 in 2026. Last night we reached $2840. if the experts are right, then it seems price appreciation will stop from today.
Absolutely dreadful Game of Mates stuff from across the ditch. The Australian has clandestine recordings of Albo and Dan Andrews troughing on fine food at a wealthy Indian's mansion who runs a dodgy international college Barkly International College in Australia which has since been deregistered.
It seems they were paid to come to dinner at the Toorak mansion with Rupinder Brar and other wealthy Indian businessmen. The Prime Minister's Office refuses to answer questions. The Australian reported, which caters mainly to Indian students, Barkly was deregistered in May after what the Australian Skills Quality Authority described in a statement to The Australian as "significant noncompliance in relation to training and assessment, enrolment and marketing and governance systems." Barkly has appealed the decision.
Is it appropriate to be dining with the multimillionaire international college owner while Australia was in the middle of investigating dodgy colleges that are bringing over international students? The Australian's surveillance uncovers them discussing visas.
https://www.theaustralian.com.au/subscribe/news/1/?sourceCode=TAWEB_WRE…
Hardly surprising that Albo has been found with his snout in the trough.
The Juice Media released a great video last year on Albo's government passing a law to make certain whistle blowing illegal. Annoyingly, I can't find it but this story from the BBC covers the same topic in a specific case: David McBride: Australian army whistleblower jailed for leaking documents
In fact, The Juice Media does a sterling job in pointing out the awfulness of Australian Government in general- if you want to laugh and cringe at the same time I recommend this video on the Labor Government:
Not in Japan by the looks of things. Foreigners now account for 3.4% of their total workforce, according to data released Friday by the Ministry of Health, Labor and Welfare. Nowhere near Aussie (1 in 3 workers born overseas) and Aotearoa
https://asia.nikkei.com/Spotlight/Japan-immigration/Japan-logs-largest-…
Despite Japan's demographic woes, it's far outperforming Aotearoa and Aussie on GDP growth per cap. In fact, Japan has outpaced Australia in real GDP per capita since the end of the GFC through to recent times. They don't open the gates willy nilly to millions of immigrants they neither need nor want. Or to prop up a Ponzi or dodgy education industry.
Don't paddle out too deep P, you run the risk of getting out of your depth not too far from the safety of the shore.
Well the numbers don't lie P. The recent RBNZ cost blowout exposure and hiring spree is a good comparison. Lord Orr spending and behaving like a drunken sailor hitting shore for the first time in 6 months. While the BOJ's headcount has barely increased in 10 years and have a ceiling on full-time employees. Lord Orr increased headcount by 18% in 2024 alone.
You're having the wrong argument.
Look, fairly clearly, this life doesn't stack up to you. It doesn't for me either, but I'm here anyway so might as well give it a crack. Rather than waiting for a payday dependent on the fall of civilisation, get an ESL teaching cert, move to Japan, and try living a different sort of life.
Quite happily live in Japan P. But teaching English is a dead-end existence unless you're doing it for charity.
But back to the point. Luxo and the wingnuts / Paul Conway are suggesting we need to shift towards an economy based on growth. Arguably, we should be looking at countries like Japan who have policies that focus on production; innovation; living with your means as a nation; and driving national wealth as opposed to being a nation of low-level rentiers.
Just been reading about Honda. You're unlikely to know that they're an aviation company since the 80s. They had a vision and by 2017, Honda had established itself as the best-selling manufacturer in the small business jet category with the HondaJet Elite II. Looking toward the future, Honda aims to achieve type certification for its new light jet, the Echelon, by 2028. True to its legacy of efficiency, the Echelon is expected to achieve a range of 2,625 nautical miles (3,020 miles)—making it the first small jet capable of nonstop transcontinental flights across the U.S.
Chances of that happening in Aotearoa are slim to zero.
But teaching English is a dead-end existence unless you're doing it for charity.
Is your existence working out here?
You'd earn 4x the minimum wage, while finding out if the grass is really greener. Way better return this justing constantly positing it might be, based on some arbitrary metrics.
You don't understand. Let's compare Aotearoa with select Central / Eastern European nations on real GDP growth per capita 2019-2024.
Poland - 23%
Hungary - 17%
Latvia - 13%
Slovenia - 12%
Aotearoa - 0.1% (lower than all Eastern Europe countries except Estonia)
So in your mind this is irrelevant because the minimum wage is higher in Aotearoa and Rocket Labs was created. Stick to your property seminars P. It's your only hope.
Also have you heard of Japans work ethic? Do you think this culture would be tolerated in a Japanese workplace(see link below). In Japan you apologise and show gratitude to colleagues and employers if you take one weeks leave outside of traditional holidays.
No wonder Japan continues to thrive when the odds are against them. NZ carries too much deadweight.
https://www.stuff.co.nz/nz-news/360562906/abusive-inland-revenue-worker…
It’s understandable that farmers don’t want an Unmitigateable tax on animal emissions.
What doesn’t make sense is farmers fighting efforts to reduce vehicle emissions. If they were politically savvy they would throw their support behind transport and energy emission reductions (where technological adaptation is possible). The more emissions are cut in non-farm sectors, the less pressure there will be on farming.
The gold market conspiracy theory thickens as bullion banks have to “borrow” gold from the central banks in order to meet deliveries.
London bullion market players are racing to borrow gold from central banks, which store bullion in London, following a surge in gold deliveries to the United States on speculation of potential import tariffs there, two sources familiar with the matter said.
"The key with the BoE is that they are not a commercial vault so not prepared to handle the onslaught of gold borrowing banks are requesting from the central banks," said Robert Gottlieb, an industry expert and former head of precious metals at Koch Supply and Trading.
https://www.reuters.com/world/uk/london-gold-market-queues-up-borrow-ce…
A ponzi is where you take investment money but don’t actually invest it:
A Ponzi scheme is an investment fraud that pays existing investors with funds collected from new investors. Ponzi scheme organizers often promise to invest your money and generate high returns with little or no risk. But in many Ponzi schemes, the fraudsters do not invest the money.
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