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
SBS Bank reduced its one year rate by -10 bps to 5.69% today. the Police Credit Union also cut selected rates. All rates are here.
TERM DEPOSIT/SAVINGS RATE CHANGES
SBS Bank and Nelson Building Society both reduced TD rates. But SBS Bank's 5.35% rate for 6 months is still available. Rabobank cut some of its ket TD rates too. All updated term deposit rates less than 1 year are here, for 1-5 years, they are here.
MUCH TO CELEBRATE
Home loan affordability improved significantly for first home buyers in 2024 thanks to three key factors.
CORE FUNDING HIGH
The RBNZ said the Core Funding Ratio for all banks popped up over 90% at the end of December. It wasn't this high in any other month of 2024, although to be fair it usually spikes in December. This metric shows how much of a bank's funding that is stable and can be assumed to stay in place for at least 1 year (‘core funding'), related to the core lending business of a bank that needs to be funded on a continuing basis.
FAST TRACK LOOKING FOR A FAST START
Today is the start of the Fast-track Approvals regime which is supposed to make it quicker and easier to build "the projects the country needs to grow its economy". fasttrack.govt.nz is now open now for project applications. Listed projects can apply now for consideration by an expert panel. Other projects can also apply to enter the Fast-track process. Retired Environment Court Judge Jane Borthwick has been appointed as Convener of the expert panels.
ENDING THE WEEK ON A WHIMPER
The NZX50 is up +0.2% in 3pm trade, on track for a weekly fall of -0.5%. There are 43 gainers led by usual laggard NZME, Fletcher Building, and Turners. There are 42 decliners, led by Manawa Energy, a2 Milk, AirNZ, Vista and Gentrack. Market heavyweight F&P Healthcare is up +0.6% today.
TOWER GIVES CLUES
And listed insurer Tower advised investors that its profits are rising, and this year will come in above the upper end of their prior guidance. Most insurers are not listed in New Zealand and are likely to be doing just as well, even better, than Tower, if only because that have market dominance (IAG AIG) and volume advantages.
MORE POSITIVE ECONOMIC EVIDENCE IN JAPAN
Japan is reporting that household spending jumped in December and by very much more than anticipated. It was up +2.7% in December from November when only a +0.5% rise was anticipated. That large monthly shift now means that the year-on-year rise is +2.3%. If Japanese consumers are opening their wallets, it is both a sign that sentiment is rising, and it will be some counterbalance to the US ructions and the Chinese slowdown.
GOLD APPEALS WHERE RISK IS HIGH
The World Gold Council said that gold supply rose +1% in 2024. But demand was quite varied. Central banks bought up big in Q4, but jewellery demand slumped -11%. Bar and coin 'investors' in Eastern markets were attracted by the rising gold price, while those in Western markets "responded with profit-taking" (ie net selling).
SWAP RATES RISE
Wholesale swap rates are probably noticeable higher today, especially the two year, 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 bp on Wednesday at 3.88%. The Australian 10 year bond yield is down -5 bps at 4.39%. The China 10 year bond rate has dropped -3 bps to 1.61% and "doing the PBoC's job for it". The NZ Government 10 year bond rate is up +2 bps at 4.61% while today's RBNZ fix was 4.54% and down -3 bps. The UST 10yr yield is now just on 4.44% and down -8 bps from this time yesterday. Their 2yr is holding at 4.22%, so that positive curve is a lot less steep at +22 bps.
EQUITIES MIXED
The NZX50 is up +0.3% in late Friday trade. (See above.) The ASX200 is an outlier, unchanged in afternoon trade. Tokyo is also an outlier, down -0.4% in early Friday trade. Hong Kong is up +0.4%, as is Shanghai. Singapore has opened up +0.3%. Wall Street ended today's trade higher with the S&P500 up +0.4%.
OIL DROPS
The oil price is down -US$2 from this time yesterday now just over US$70.50/bbl in the US, and at US$74.50/bbl for the international Brent price. Sagging demand prospects are behind the weakness. The oil barons who supported Trump must be having second thoughts as sub-US$70 prices and lower volumes are probably not what they envisaged.
CARBON PRICE STAYS IN RANGE
The carbon price is still within its tight range, today still at NZ$63/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 RISES
In early Asian trade, gold is up +US$18 from this time yesterday, now at US$2865/oz.
NZD RISES
The Kiwi dollar has risen +30 bps from this time yesterday, now at 55.8 USc. Against the Aussie we are little-changed at 90.4 AUc. But against the euro we are up +40 bps at 54.8 euro cents. This all means the TWI-5 is now just under 67.2 and up almost +20 bps from where we were yesterday.
BITCOIN ON HOLD
The bitcoin price is little-changed (-0.2%) from this time yesterday, now at US$97,592. Volatility of the past 24 hours has been modest at just over +/- 1.7%.
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40 Comments
Talking out of one side of their face as they talk taking Canada's LNG and chatting to Trump.
I guess Like the rest of us they've figured charm and play around his ignorance.
Goodness they may even suggest following his success with casino's and he takes the role of Chair of the board for US Real Estate development to remake all the destroyed cities in California..or even Baltimore.
Talking out of one side of their face as they talk taking Canada's LNG and chatting to Trump.
Aussie is the main supplier of LNG to Japan. The US is second. So approx 80% from these two nations.
Trumpty Dumpty is talking a new age of prosperity in partnership with Japan.
In the finest traditions of innovative Kiwi companies being bought out just before they strike it big, IKE are up about 30% today after an unsolicited offer which they briefly flirted with before decided the offer wasn't generous enough.
Can they hold out or do we lose this company just as it is becoming a standard supplier to electricity distributors across the USA?
So far the expected/ sarc...didn't happen. The Market selloff lasted one day. Unlike some I held on to my hat and stayed the course. So far more than content as Ike jumped.
All I can see out of all the chaos from the rearrival of Trump and his run a Musk I note the Pentagon has yet to have a visit from the team of Doge and employees to get a buyout offer.
We've seen Opec basically tell Trump we make the price setting.
Commodities with the exception of diamonds appear to doing quite well.
So I am thinkig 14th and a diamond is a girls best friend. Time to murmur.
The World Gold Council said that gold supply rose +1% in 2024. But demand was quite varied. Central banks bought up big in Q4,
If LBMA bullion banks have ran out of gold from their own London stocks, and can’t get any more gold via borrowing from the BoE, then how can they allocate gold to customers who want to convert unallocated into physical?
They can’t. In my books, that's what a default looks like.
Data From the World Gold Council:
"In the final quarter of 2024, when Trump won the U.S. election, buying by central banks accelerated by 54% year on year to 333 tons "
Of course, Lord Orr and Aotearoa in general see no place for gold. That's for poor nations.
Central banks, a major source of gold demand, bought more than 1,000 tons of the metal for the third year in a row in 2024"
"In 2025, we expect central banks to remain in the driving seat and gold ETF investors to join the fray, especially if we see lower, albeit volatile interest rates," WGC senior markets analyst Louise Street,said
https://www.reuters.com/markets/commodities/gold-demand-up-1-2024-remai…
Prime Minister Christopher Luxon said the dam was a huge testament to people who had worked together for 23 years to make it a reality, in spite of a “Mickey Mouse backward way of funding and financing”.
Good god. This charlatan is a prick. Sure. That project has gone through a rigorous process - and one NZ Inc can learn much from.
But Mickey Mouse?
No. Absolutely NOT. Process had to be followed. Now, it presents a precedent. It will - I hope - become a model. And next time, we'll do it faster. (And cheaper!)
Source: https://www.stuff.co.nz/nz-news/360573598/we-wish-wed-got-it-sooner-say…
Where would we be right now if we had not built so much hydro back in the day......
NZ Greenies are totally unrealistic, NZ has highest energy renewables in the world... but we are still burning coal because your Pr(*ks won't let us build a few more wind farms solar farms or damns.
environmental terrorism
I bet you are a vegan.... animal rights and all.
What about my rights and my kids rights to live in a modern world, to move NZ forward so we have no coal... As a past grade 5 kayaker I hate damns, but if we don't build them for irrigation or electricity guess what... gas and coal. even your vege's need water.
There are plenty of west coast rivers you can helicopter into to paddle grade 5, that can never be damned.
One day we made even use electric drones to get to them, but in your world they would be coal powered.
IT - your mate Shane is hell bent on Coal and seabed mining. so the company that was expected to start on a massive wind farm has given up ...too many delays (thanks to Seimone delaying legislation)- so why is this the fault of the greenies?
Taranaki Offshore Partnership, a joint venture between Copenhagen Infrastructure Partners and New Zealand Super Fund, is investigating a proposed offshore wind farm in the South Taranaki Bight,
And guess what tourists come here for..what to gaze an open pit mines lovelingly?
Your kids cannot have it both ways...have you actually asked them?
My youngest thinks Trump is a complete idiot, hates him, but would vote for ACT here, she says Greenies and Labour have only stories not solutions, she wants to be a Civil Engineer and build solutions. Very woke but hard right (an interest combination). we are very close as have done so many road trips from AKl to QTown to ski, we talk a huge amount and debate in a respectful manner. Happy to build buildings, roads, dams or offshore rigs.
Oldest daughter hates politics and councils but says we are going backwards, off to Uni this year, to do law and science.
Oldest son, finished comp sci Otago, now IT coder full stack dev ops SME, is off overseas this year because there are so few job opportunities here.
https://www.nzherald.co.nz/nz/north-canterbury-residents-oppose-solar-f…
Be it frogs, dotterals or NIMBYs, we need to move forward.
Lets get a few things straight here though.
Us greenies, are VERY interested in building solar/wind farms. Your example is a bunch of NIMBY's being stupid. Likely their concerns are non events and will be defeated. NIMBY's are one of the major reasons major electricity generation projects (like Castle Hill Wairarapa) never go ahead.
Us greenies don't want to build dams like in the Mokihinui. And I challenge you to go up there, spend a couple of days exploring the area and explain why you would believe its a good idea. Its a pristine and stunning environment that has barely seen the footprint of man. And its beauty is off the charts as is its biodiversity. There are PLENTY of other options for dam building, particularly in areas that have already seen huge modification by man or whose biodiversity is on a much lower scale. On rivers like the Clarence, the Aratere, Otaki just off the top of my head, there are dozens of sites around the country. What we don't want is huge water storage schemes expressly to create more dairy farms as they clearly result in highly polluted water ways for dubious economic benefit (privatising profits and socialising costs).
One of the hilarious things NZ does is not build stuff on already modified environments. I challenge anybody to explain why we don't BUILD SOLAR FARMS ON CARPARKS, as a freaking rule. It means we can generate huge electricity, right next to huge users of electricity, right when that electricity is needed. It means cooler car parks, less urban heat island, less use of fossil fuels to power AC in cars. We have thousands of hectares in carparks in this country yet want to instead ruin sites like the Mohikinui because I want my carpark to have an uninterrupted view of the sky? Pure stupidity.
We also have a broken electricity market that is in dire need of reform to separate electricity generation and retail.
Greenies have solutions that will work as they have in dozens of other places around the world. But nobody wants to back them here because of conservative NIMBYism that stops real, green development in its tracks and favours destruction of our most wild and beautiful places over enhancing our markets and built environments. There's a lot both hard conservatives and greenies can agree on when it comes down to it. But both have to reach across the aisle to recognise it.
Quality rant. A++ would read again.
But aside...didn't we dam most of the practical places already? I was talking to a waters engineer from way back the other day, and he was discussing the fact they'd surveyed all around the country back then and basically they dammed what they could.
Re objections to solar and wind installations , that often seems the silliest nimbyism around, yeah.
More geothermal - wonder if that's got legs here, depending on what remains available.
Be nice to see small nuclear developed - beyond our budget to develop, obviously, but one might hope it gets developed in USA (if donors allow it) or China.
Re the kids, it'd be nice if we could leave them safely swimmable waterways too, but this lot seem very resistant to any user-pays approach to pollution costs.
Thanks, yes dams are now limited. The solar farm opposition is nuts. Perhaps these people have ALL there retirement savings tied up in some silly little houses nearby?
anyways
I like geothermal, even if it has to be done with local iwi as they own the steam gods. Its possibly good investment compared with whale song BS. Small nuclear is a long way away internationally - 30-40 years and if you don't want a few passive solar panels next to your house you think that's going to be easy in NZ????
re Coal, why did we shutdown our coal mining when we need to import coal? Greenies must hate we are still importing coal. we where only days away from rolling blackouts last year, our industry had shuttered plants for weeks... most do not know how close it was.
Greenies going puke as we import LNG
Yes, the solar farm opposition is bat shit crazy. Even if they did have their houses nearby, its not like solar is going to dramatically ruin their view, its so weird.
We don't need coal if we turn Huntly into a burner of wood pellets, which has already been successfully trailed. We can essentially use pine forests to turn Huntly's generators. This appears to be in the works already.
We also don't need LNG if we go full electric, build more batteries, more renewables and like you said, lots of geothermal. If the conservative NACTF didn't shut down the NZ battery project, we would be on our way to real solutions. But I could argue, conservatives are killing NZs chances at moving forward, with stupid decisions like that. That WILL cause rolling blackouts as it was coming up to solutions for the dry year problem. Guess what, when we were importing coal, that was as a result of the dry year problem.
Don't blame the greens for conservative incompetence. There is plenty of blame to go around.
Facts.
This bloody great $211m monstrosity is equiped for neither electricity nor irrigation.
There's a reason for the delays, the vast majority of which revolve around the fact it should never have been built and that those benefitting (?) are paying by far the smallest share.
It has a hydro channel in it, its just not installed.
And it IS for irrigation. The purpose of the dam is so that the river keeps flowing steadily, meaning the aquifer under Tasman is continually refilled and doesn't suffer from salt water ingress when it is low. Why is that important? Because people producing crops on those plains pump water up from the aquifers to irrigate their crops.
Investors fleeing Sydney and Melbourne apartments. Chink in the armor of the land of milk and honey.
Around 8300 investor-owned properties were listed for sale across Melbourne in December, up 6.6 per cent from the previous year and climbed 14 per cent above the last five-year average.
Sydney investors are also leaving the market in droves. More than 6000 ex-rental properties were listed during the same period, which is 1.7 per cent higher than the previous year and 2.8 per cent above the last five-year average.
Apartments in Sydney delivered just 1.8 per cent capital growth last year, while Melbourne fell by 3 per cent. By contrast, Brisbane racked up 16.6 per cent, Adelaide gained 16.9 per cent and Perth 22.7 per cent.
https://www.afr.com/property/residential/landlords-pull-out-of-melbourn…
Blimey
“Some investors who bought units or apartments in Melbourne have not received capital gains now for almost a decade, if not sometimes for the past 15 years, so they want to sell so they can deploy their capital elsewhere, or at least get rid of a property that’s been weighing their borrowing capacity down,” he said.
Of course the NZCC were always going to raise doubts about Contact's acquisition of Manawa....they think it maybe anti-competitive; if this were so then what do they say about the Government's majority ownership of three of NZ's largest power companies: Meridian, Mercury, and Genesis!
If the Commerce Commission were to decline the acquisition then, to be consistent, would it then direct the government to relinquish their majority shareholdings in the 'big three'?
It will be a test of this Government's trumpeting about their support of entrepreneurial private business if they allow the NZCC to prevent a public company from competing with the government-controlled power behemoth.
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