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
Kainga Ora, First Credit Union, UnityMoney, and China Construction Bank all reduced fixed rates today. All rates are here.
TEST RATES MOVE DOWN
More banks are moving their test rates down. Today Westpac advised it had cut theirs to 7.25%. We have a new table page tracking current home loan test rates as they are announced. Please help us keep this page accurate.
TERM DEPOSIT/SAVINGS RATE CHANGES
BNZ made some minor adjustments (all down) to its TD rates, none market-moving. Treasury cut 25 bps from all its Kiwi Bond interest rates for terms 6 month to 2 years. First Credit Union and UnityMoney also cut TD rates. All updated term deposit rates less than 1 year are here, for 1-5 years, they are here.
NO BIG UPSIDE
House prices are unlikely to surge as long-term interest rates remain steady despite cuts to the Official Cash Rate, Treasury’s chief economist said.
STILL QUITE POSITIVE
The latest ANZ business confidence survey, for February, found overall confidence rose, while expected own activity eased. Past own activity (the best GDP indicator) fell to a net negative, while employment was flat.
CHANGES COMING VERY SOON
Friday, February 28, 2025 is the last day you can comment without being a Supporter. And that is also the last day you can get our daily or weekly email newsletters without being a Supporter.
IT'S DRY IN TARANAKI
The Government today classified drought conditions in Taranaki as a medium-scale adverse event, acknowledging the challenging situation facing farmers and growers especially in the Manaia, Hāwera and Kakaramea regional hotspots. This classification unlocks support for farmers and growers, including tax relief, and it enables the Ministry of Social Development to consider Rural Assistance Payments. Money for Rural Support Trusts will also be available. It is the earliness of this dry period that is unusual.
ONE IN SIX LIVE WITH A DISABILITY
Using international criteria and benchmarks, Stats NZ says 17% of people living in households were disabled in 2023. The 2023 Household Disability Survey (HDS) found 10% of children (98,000) and 18% of adults (753,000) were disabled. In total, 851,000 people were disabled. The levels are unlikely to be less in 2025.
INVESTORS ARE BACK BORROWING
Latest figures from the Reserve Bank show that investors took 22.5% of the committed mortgage money in January - the highest percentage claimed by this grouping since February 2021.
NZX UPDATE
The NZX50 is recovering today, up +0.6% at 3pm from yesterday's close, but that still leaves it down -2.8% for the week. From a year ago it is up +7.1%. More details here. Tourism Holdings, SkyCity, Chorus, and Gentrack are today's biggest gainers, while Summerset, Meridian, Tower, and Contact lead the decliners
BIGGER MARKET SHARE BUT LOWER PROFIT
Kiwibank reported its interim profit was down -12% from last year's record high, with lending and deposit growth outstripping overall market growth. But expenses rose and their net interest margin fell.
LOOKING FOR SUSTAINABLE GROWTH THAT IS PROFITABLE
Heartland Bank also reported its half-year result, and their profits fell -90% after some major writedowns. They have identified some aspects of their business that they wish to quit or divest.
MORE NORMAL DEMAND AT LATEST BOND TENDER
Another $500 mln of NZ bonds were tendered today in three maturities. They attracted 111 bids worth $1.7 bln for the $500 mln available. 40 of those bids were successful. Yields were about -10 bps lower than at the prior equivalent event.
NEAR BREAKING POINT?
Seen the power price price hike notices from your friendly gentailer recently? In hindsight you might be 'happy' with them, at least 'happy' they weren't more. But more is probably coming. Today much of the wholesale pricing was over $400/MWhr, and some time in the past 24 hours there was $700/MWhr pricing. It is not the frequency of recent spiking any more, it is that baseline prices are staying up for much longer. There is something broken in our electricity market, or the sector. It was only recently that some large users and employers threw in the towel and closed. At these higher levels we may see a new wave of closures.
FOUR YEAR TERM UP FOR ACTIVE DEBATE
As per the Coalition Agreements, the Government will introduce legislation that will enable a four-year term of Parliament if a referendum consents. It is possible a referendum could be held alongside the next General Election in 2026. However, any final decisions on timing for a referendum will depend on what comes out of the select committee process.
THEY WILL PROBABLY GET WHAT THEY DESERVE, A SECOND TIME
The US is facing a new pandemic, this one from the H5N1 Bird Flu. They are facing the risks in the usual Trump way - by blocking work on a vaccine. It had been developed and was about to go into trials, but it is these trials than have been stopped. So far only a handful of humans have been infected. But some cattle herds (the latest in Nevada) and poultry flocks are under strain. That has caused US egg prices to skyrocket, and milk production to slip. Apart from pulling back protecting Americans or their farmers, the US is importing eggs from Turkey. Although the H5N1 virus has been around for many decades the new D1.1 variant carries a recent mutation that helps the virus copy itself more easily onto the cells of mammals, including humans.
SWAP RATES STILL ON HOLD
Wholesale swap rates will likely be little-changed yet again, but keep an eye on our chart below which will record the final positions closer to 5pm. The 90 day bank bill rate was up +1 bp at 3.76% on Wednesday. The Australian 10 year bond yield is up +1 bp at 4.40%. The China 10 year bond rate is unchanged at 1.77%. The NZ Government 10 year bond rate is up +5 bps at 4.66% while today's RBNZ fix was at 4.59% and up +4 bps. The UST 10yr yield is now just on 4.28% and down another -4 bps from yesterday. Their 2yr is down -2 bps at 4.09%, so that positive curve is slightly flatter at +19 bps.
EQUITIES MOVE LITTLE, NZX50 LOOKS GOOD BY COMPAIRON
The NZX50 is up +0.8% in late Thursday trade, its second straight day of gains. The ASX200 is up +0.3% in afternoon trade. Tokyo is up a minor +0.1% in early Thursday trade. Hong Kong is up +0.3%, and Shanghai is down -0.2% its open. Singapore has also opened down -0.2%. Wall Street was essentially unchanged on the S&P500 in Wednesday trade.
OIL SOFTER
The oil price is down marginally, now just under US$69/bbl in the US, and under US$73/bbl for the international Brent price.
CARBON PRICE STILL IN RANGE
The carbon price is still within its range, and today is down a marginal -10c at NZ$63/NZU. The next release of units at the official auction is on March 19, 2025. But that auction's floor price is $68/NZU, so it is heading for a failure. See our new daily chart tracker of the NZU price for carbon, courtesy of emsTradepoint.
GOLD SLIPS
In early Asian trade, gold is down -US$5 from this time yesterday, now at US$2912/oz.
NZD A BIT SOFTER
The Kiwi dollar has fallen -20 bps from yesterday at this time, now at 57 USc. Against the Aussie we are up +10 bps at 90.3 AUc. Against the euro we are down -10 bps at 54.3 euro cents. This all means the TWI-5 is just over 66.7 and down -10 bps from yesterday.
BITCOIN RETREATS AGAIN
The bitcoin price is down -4.5% from this time yesterday, now at US$84,733. Volatility of the past 24 hours has been high at just on +/- 3.9%.
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75 Comments
I used to think 4 year term would be a good idea - until I saw what the 6th Labour Govt would have done to NZ with another year.
IIRC the reasons for the proposed extension were about improving Govt efficiency (current Y1 about keeping their election promises & Y3 about making new ones leaving Y2 to get stuff done). Given the juvenile histrionics on daily display in Parliament & in the MSM, a better delivery on what really matters to NZ could be better served by sharper focus in reducing the term to 2years or preferably annual performance reviews (should be doable voting with an app + RealMe).
I think I’m in the same boat as you. I’m not a fan of three-year terms, but the lack of other checks and balances means our only real say comes through elections. Giving parties more time to do whatever they want will only push them further from what the electorate actually wants. I’d like to see more referendums, like Switzerland has, so people can have a say in some of the big decisions the parties make on our behalf. That way, people might feel like they actually have a voice, rather than just picking between two pretty mediocre choices.
two pretty mediocre choices. The way Luxinda is going are there really two choices or just a bunch of wet lefties and closet lefties tagging out every other term. The MSM were desperate to have Luxinda as leader of the National party before he was even an MP - now we know why.
"the Government will introduce legislation that will enable a four-year term of Parliament if a referendum consents"
Why are our "leaders" wasting hard earned taxpayer cash on this nonsense again? Is there not something of material benefit limited funds could be spent on? I'll again vote for no change, as I did last time. The current mob of politicians again proving that less is best. Might consider a two year term, if that's an option though?
My 7th form history teacher many years ago pointed out that New Zealand only has one house of parliament. In comparison, Australia, the UK and the USA all have two. This, he considered, was an important point in reducing the risk of poor legislation getting through and screwing over the population (even worse than already happens).
A second (upper) house of parliament or shorter terms... I'll take option two thanks.
NZ Upper house: we've been there before
https://en.m.wikipedia.org/wiki/New_Zealand_Legislative_Council
And another layer of politicians and another layer of civil servants all with snouts in the trough all getting better pay and retirement benefits so no from me. With modern tech every law should be a referendum easy enough to do thru modern phones no need for mps at all along with all the hangers on
If a government is going good enough it will be endorsed by the electorate to keep going. That in itself should be both a discipline and an incentive. There have been though some slight exceptions, either way.Labour was re-elected in 2020 primarily on the pandemic management but assisted greatly too by a dismal going on scandalous state of affairs in National. Before that the 3rd Labour government of Norman Kirk’s has been vindicated by history.In the face of an oil crisis, they were not doing a bad job at all. But on his passing none of the rest of them could withstand Muldoon’s vehemently destructive personality politics. Agree totally a referendum on four years is waste of time, funds and resources. The electorate will not have it.
Why?...another distraction (akin to a flag referendum)
By all means introduce a 4 year term....but only if all MPs are selected by random from the population with a one term maximum (no political parties or elections)....and it may pay to sort out a formal constitution while we are about it.
So Luxo signed a deal with VietJet for direct flights between Aotearoa and Vietnam. Sounds good. But I wonder how much Luxo really knows about VietJet and their notorious reputation.
The company itself is in a high court battle in the UK for not paying for the planes it leases. Rumors suggest some of its foreign pilots from India have dubious flight logs and qualifications.
https://www.nortonrosefulbright.com/en/knowledge/publications/c3f1060d/…
VietJet owner Madame Thao is a piece of work. Recently paid for photo ops with Trump and Musk. Previously Thao was going to pay Oxford University 155 million pounds to have her name on one of their colleges. She never studied or graduated from Oxford. A tremendous price for ego stroking.
https://www.theguardian.com/business/2021/nov/04/vietnamese-tycoon-poun…
House prices are unlikely to surge as long-term interest rates remain steady despite cuts to the Official Cash Rate, Treasury’s chief economist said.
The herd of NZ 'property investors' is the dumbest herd in NZ. Cow's are smarter. Mr Stevens will be proved wrong again.
CNN-YouGov Fear and Greed Index now at 'Extreme Fear.' The Fear & Greed Index gauges stock market movements and whether stocks are fairly priced. The theory is based on the logic that excessive fear tends to drive down share prices, and too much greed tends to have the opposite effect.
Don't say you weren't warned.
Crypto markets definitely front running the sentiment here. If you have kids playing the casino or degenerate mates getting in a little deep, you should be conscious of what's been going on.
https://edition.cnn.com/markets/fear-and-greed
Crypto’s a casino, I see it like the late Charlie Munger:
"Crypto markets definitely front running the sentiment here"
100% agree, SP500 topped in Dec, had a rough start in Jan. Can’t break new highs, won’t break new highs even with a weaker USD and lower bond yields. It’s ready to drop like crypto, which is correlated with US equities. I think mid march, around full moon, we see some sell-off.
Barfoot auctions - Tuesday:
9/21 = 42%
5/13 = 38%
2/7 = 28%
Total: 16/41 = 39%
Barfoot auctions - Yesterday:
3/25 = 12%
11/23 = 47%
0/1 = 0%
11/32 = 34%
9/23 = 39%
1/1 = 100%
2/3 = 66%
1/4 = 25%
Total: 38/112 = 33%
Barfoot auctions - Today:
2/3=66%
7/16=43%
0/2=0%
0/4=0%
0/1=0%
1/1=100%
0/1=0%
Total:
10/28=35%
Yes 9 from 11 yesterday and over 50% today.
The ones that were passed in are now on the open market available to conditional buyers .
Ray White Auction room today was chock full and property mostly selling.
Many will be delighted that I will not be commenting after tomorrow, but you will realise that “The Man” was right about the Christchurch property market not having dropped and is going to continue to rise.
This was an interesting one that sold today at auction. 133 Vodanovich Road, Te Atatu South. Thankfully, no one got caught buying this one at peak. The last sale was back in 1994. 2021 RV of $1.31m, it went at auction today for just $805k, a massive 38.5% (505K) drop.
I personally know a FHB who bought at peak in Te Atatu South for $1.07m. Their home’s estimate now sits around $800K-$895K, but if it sold today, I reckon they would be looking at low $700Ks, down as much as $350K.
When the new RVs for Auckland come out, Te Atatu South should be down 30-40% from 2021.
If you’re in an area where boomers aren’t keen to retire, expect big drops.
True that. I'm following a few houses that passed in on what I thought were reasonable bids. Will be interesting to see what happens with them. I can see one starting to show signs of regret. I think if you get a reasonable bid at auction now you should accept it. I did this back in 2018 and my wife gave me hell for it. I'm in a very odd position of not being particularly concerned how things go. In fact I can say now, "see I told you it wasn't a bad price!".
That said, I was tracking these sorts of properties last year and about 90% did get more than the auction bid. Just the odd one eventually sold for less. These days I think outcomes will be worse.Time will tell.
Cambridge seems to be the Riverhead of Waikato. I can't understand the prices there other than it's a place some boomers would retire. Just outside of Cambridge, you can buy land for around 200K. If more and more land continues to hit the market, it's going to hit housing considering half the cost in most cases is the land component.
could work as long as they get decent $$ per kwh as then when the cars return at night hydro could charge there cars.....
but the market is setup for profit not optimal energy use and distribution...
as a B.E Hons (Elect) I believe we need to look at this, its complicated by the ownership of the assets
I think in the past our structure may have worked but it needs to be reconsidered due to the lack of gas.
We need base load electricity not reliant on the weather. Take wind as there is 1256kws of wind capacity and only 96Megawatts being produced at the moment. Coal and gas are producing 877Magawatts. Manapouri has 800Megawatts at full production, So were is NZ going to get more then Manapour's production in dams, wind and solar?
National Park on the other side.
A better option would be to pump up to lakes higher up. There's a few that could be made bigger, or dry valleys that could be made into lakes. If you. Go high enough to the north you have the added option of releasing into the wakatipu headwaters, so having a choice of which hydro system needs extra water the most.
But mostly in National Park, in addition Iwi are against moving water between river catchment.
Floating nuclear power plants to be mass produced for US coastline
https://newatlas.com/energy/core-power-plans-mass-produce-floating-nucl…
Why is it madness, if we cannot afford pumped hydro what choice do we have?
This is largely a circular issue, we are not creating enough economic activity to fund a true transition so we are stuck in no mans land. Sometimes green, other times not. I see this conundrum an awful lot. Green-leaning voters in communities opposing all sorts of economic activity but then getting angry when the local ambulance leaves, or bank branch closes etc. They want their bene's, want their heavily subsidised health care close by, want a fire station, want the roads sealed and maintained.
Well, maybe don't oppose economic development then - too dumb to understand.
There is a bigger level of dumbness.
Sure, the GND types are wrong - in that rebuildables (the real term) canot match the surplus energy we have indulged in this last few decades.
But the idiocy which thinks ????? that economic development can (a) go forever and (b) is somehow divorced from the need for energy - high-EROEI energy, or low entropy, if you prefer the scientific term - far outweighs the GND version.
Edit - and it's NOT 'afford'; it's: can commit energy and resources to...
and that is triage territory
what choice do we have? Well, we could follow the swedish system and set up a waste to energy plants to provide electricity and heat. We could could run them on free school lunches and claim carbon credits.
https://www.trtworld.com/europe/swedish-recycling-so-successful-it-is-i…
Who said we can’t afford pumped hydro? We didn’t have to have the last tax cut, we could have done without it. With that $3 billion a year we could have afforded pumped hydro, ferries, hospitals, rail, and more. The can’t afford it argument is right wing bullshit.
There is a bit of that, but you get a lot of hypocrisy in all parties voters wants, not just the Greens.
Coming back over the tongariro saddle I was pondering the use of the lakes and canals for pumped storage. A problem is a lot of it is national park, though plenty that is just scrub or pine forest. But even using the canals alone could possibly be enough storage for a 24 hour "battery".
Even US homeowners with a 3% mortgage are now finding they can't afford to stay in their own homes.
"I feel trapped": how home ownership has become a nightmare for many Americans.
Elevated mortgage and loan interest rates, exploding home insurance premiums and rising property taxes in many parts of the country, as well as higher costs for energy and eye-watering costs for home maintenance works have flipped the dream of owning a home into a nightmare for many Americans.
Homeowners who had assumed their properties would become valuable assets and provide security described their homes as “money pits” and “financial burdens”, and said they felt stuck in homes they could barely or no longer afford, with insurance, taxes, utilities and maintenance now often costing more than people’s mortgages.
https://www.theguardian.com/us-news/2025/feb/24/us-home-ownership-mortg…
This always, always, was going to happen.
The vast majority don't think logically (in hindsight, that sentence might have been one word too long).
Optimism bias, coupled with self-confidence, aided and abetted by the media ('growth is good, growth is forever').
I guess that why congregations are big, and bishops are few...
Perhaps what it is telling us is that the modern youth have no skills-or interest-in being home owners who take care of home maintenance themselves- instead they are mentally attuned to be renters who just call someone and never have to pay for it,and are now shocked that they are the ones paying. Time for upskilling.
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