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
No changes to report today. All rates are here.
BUSINESS BORROWING RATE CHANGES
ANZ said it has cut three key business borrowing rates today, including their Business Bank Indicator rate to 11.85%, their Agri Current Account rate to 10.05%, and their Business Overdraft rate to 13.85%.
TERM DEPOSIT/SAVINGS RATE CHANGES
There are none here today. But this review of savings account options may be useful. All updated term deposit rates less than 1 year are here, for 1-5 years, they are here.
SIGNS OF LIFE I
Stats NZ figures show that manufacturing and wholesale sale figures flipped into positive territory in the December quarter after both going backwards in the September quarter. The meat and dairy sectors were strong contributors. It is the agri-business sector pulling the economy up.
THE BIGGEST WHINERS ARE THE BIGGEST GAINERS
In another release, StatsNZ said that the total number of filled jobs (from employer payroll returns to the IRD) were down -1.6% to 2.285 mln as at December 2024. It was the public sector hiring that is keeping this from falling faster. Education (up +1.9%), healthcare (up +2.4%), and "arts & recreation" (up +2.8%) were the largest rises in the year. IT (-8.6%), administration (-6.8%), and construction (-5.8%) had the largest retreats. It was similar for compensation. Overall earnings were up +4.5% for the year, with education up +5.5%, healthcare up +8.2%, and public administration earnings up +7.0%.
SIGNS OF LIFE II
ANZ said today that a review of activity by its credit card holders shows overall card spend growth rose +1% in February from January, a welcome result after recent weak outturns. The types of spending most sensitive to interest rates (housing, durables, and discretionary spending, including clothing) are still experiencing the largest falls versus a year earlier. Tourism categories of spending are well down versus a year ago. Business goods & services are now top for annual growth.
NZX UPDATE
The NZX50 has dropped -1.3% in today's session so far, extending its monthly decline to -4.1%. Despite the slump, the index remains up +4% year-on-year. The down day on global risk aversion was led down by Summerset, Infratil and Freightways. Vista, Vital, Tower and Auckland Airports were among the few gainers
A BIG IMPORTANT IP PROTECTION WIN IN CHINA
German controlled, but locally listed horticulture marketer T&G Global said today it has won an important IP protection case in the Chinese court system, in fact at their top court, the Supreme People’s Court of the People’s Republic of China. This is precedent-setting and will allow them to move against IP theft in China, and protect their local production of the ENVY apple variety by its licensee.
MUSK ALTERNATIVES EXPAND
For mobile phone users attracted to the One.NZ-Starlink option, but turned off by its Elon Musk ownership (as Tesla is finding, not to mention the recent SpaceX "issues"), there will be an alternative soon in New Zealand. Telco 2degrees said it is aiming for a 2026 launch with AST SpaceMobile - with 4G/5G broadband from mega satellites, allowing users to avoid the Musk odors.
WE ARE HIRING
interest.co.nz needs an experienced business or economics journalist to work from our Auckland office. More here.
AND SO IS REALESTATE.CO.NZ
In what appears to be a sudden decision, the chief executive of the REINZ, Jen Baird, has resigned, to be immediately replaced in an acting capacity by long-time manager Rowan Dixon.
SOLID GAIN TO THREE YEAR HIGH
The Australian consumer sentiment survey by Westpac/Melbourne Institute reported a solid improvement in March, and taking it to its highest level since May 2022.
SLIPPING BACK TO DECLINE
Meanwhile the NAB business sentiment survey for Australia reversed in February in their report released today. They said business conditions rose marginally in February, with small lifts in both trading conditions and profitability. However, there was a notable fall in business confidence which fell -6 points, largely offsetting the improvement seen in January.
AUSSIE HOUSING VALUES RUN OUT OF PUFF
The total value of housing in Australia owned by households reached AU$10.6 tln as at December 2024, up +4.4% from a year ago. That is a AU$448 bln rise in a year, but far less than the +8.1% rise in the year to December 2023, or +AU$760 bln. If we included the dwelling stock owned by others, the rise to December 2024 was also up +4.4%, and that adds another AU$440 bln, taking the total value of Aussie housing stock to AU$11 tln. Interestingly, all the 2024 rise happened in Q1-2024 - total values were flat for the rest of the year even after their new builds were added. (This para has been updated with corrected total values. H/T AW)
SUDDEN ABOUT TURN
The January Japanese household spending survey released today delivered a large shock, with spending falling the most in one month since 2021. That dragged their year-on-year gain down to just +0.8% from +2.7% in December. No-one saw this coming, although it has to be said there have been other December/January shocks in the past and all followed by a recovery in February. All the same, perhaps Japanese households are suddenly turning fearful about what lies ahead, with reason this time.
SWAP RATES SOFT, LONG RATES FALL
Wholesale swap rates are probably marginally softer again today, but 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 at 3.70% on Monday. The Australian 10 year bond yield is down -7 bps at 4.40% today. The China 10 year bond rate is up another +4 bps at 1.89%. The NZ Government 10 year bond rate is down -5 bps at 4.65% while today's RBNZ fix was at 4.62% and down -2 bps. The UST 10yr yield is now just under 4.17% and down -11 bps from this time yesterday. Their 2yr is down -15 bps at 3.84%, so that positive curve is now at +33 bps.
EQUITIES ALL IN BIG RETREATS
The NZX50 is down -1.3% in late Tuesday trade. The ASX200 is also down -1.3% in afternoon trade. Tokyo is down -2.3% in early Tuesday trade. Hong Kong is down -1.1%, and Shanghai is down -0.4% at its open. Singapore has opened down -1.6%. The S&P500 fell -2.7% in Monday Wall Street trade, spooked by how the US Administration is managing the US economy. But at least it was a recovery from the -3.5% drop an hour before their close.
OIL FALLS
The oil price is -US$1 softer from this time yesterday and now just over US$65.50/bbl in the US, and just on US$69/bbl for the international Brent price.
CARBON PRICE GETS MINOR BOUNCE
The carbon price is up a minor +50c today at NZ$61.75/NZU on improved volumes. That is just off its six month low. 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 RETREATS
In early Asian trade, gold is down -US$22 from this time yesterday, now at US$2889/oz.
NZD SUFFERS AS A COMMODITY CURRENCY
The Kiwi dollar is down -30 bps at 56.9 USc from this time yesterday. Against the Aussie we are unchanged at 90.7 AUc. Against the euro we are down -30 bps at 52.4 euro cents. This all means the TWI-5 is just on 66.4 and down -30 bps from this time yesterday.
BITCOIN DOWN AT FOUR MONTH LOW
The bitcoin price is down -3.4% from this time yesterday, now at US$79,136. Volatility of the past 24 hours has again been very high at just on +/- 4.5%.
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60 Comments
The total value of housing in Australia owned by households reached AU$1.06 tln as at December 2024, up +4.4% from a year ago. That is a AU$448 bln rise in a year, but far less than the +8.1% rise in the year to December 2023, or +AU$760 bln.
The Aussie Ponzi is the gift that keeps on giving. The 8th wonder of the universe.
The bitcoin price is down -3.4% from this time yesterday, now at US$79,136.
Ratty trades 24/7 - anyone with an internet connection can trade. Failure results in bankruptcy or liquidation. No country’s finances are tied to BTC going up in price.
Equities trade 8/5, but only certain people can trade them. Failure for the politically connected results in bailouts.
Marginal tax receipts in the US are directly tied to the stock market. The mkt gets a bailout - depends on whether your portfolio is still alive when it occurs.
BTC is a true free market, but stocks are not. Therefore in a fiat liquidity crisis, BTC leads stocks on down and upside.
Failure for the politically connected results in bailouts.
Every so often they throw a global bank to the wolves.
Every so often they throw a global bank to the wolves.
Or to the other global banks and / or Warren Buffet. Remember, Buffet has been a big beneficiary of crony capitalism.
So apparently (and according to left leaning media) Trump and Musk have been making policy changes in order to make billionaires richer at the expense of others, but simultaneously the left leaning media take pleasure of late in reporting how much poorer these same billionaires are when the same policy decisions cause their wealth to drop as markets react to their new policies.
So which is it? Do their decisions make them richer (which they are accused of in my opinion unfairly) or poorer (which is now being gleefully reported). You can’t have it both ways.
"You can’t have it both ways."
..."socialism is having your cake and eating it" until you run out of other people's cakes
Whereas capitalism is eating other people's cake and getting them to pay for it.
Just describing the posters on your bedroom wall
"Whereas capitalism is creating other people's cake and getting them to pay for it."
Fixed that for you.
No, you did not.
'Taking' is the operative word.
I understand the need not to understand (some go woke doing the same avoidance but by a different pathway).
The World Bank, the IMF, the 'rules-based-order' (ours); all had one aim - to divest.
We were the beneficiaries of that little junket - wear it.
There's a few ways I can think of to square that circle.
Maybe it's actually all about making Trump rich, and he doesn't care about the others. This got off to a great start when $TRUMP coin launched before inauguration and within days made up the majority of his net worth.
Maybe that's the plan, but they are actually incompetent and not achieving it. This fits quite well with Trump's brand.
Maybe we take Trump's recent language on face value, and this is just temporary disruption before the new order is established, with new power structures and riches following to the plutocrats.
Not sure which I believe - they all have a glimmer of believability. But to be honest, I think ascribing intentions and forward planning, or logical consistency to Trump is a mistake. To quote one of his former staffers, he's not playing chess, there just trying to stop him from eating the pieces.
Cutting the budget deficit from 6% to 3% of GDP (what DOGE is doing) is going to be painful to the economy and will almost certainly cause wealth destruction in the short term (in the form of recession and asset price falls as the gravy train for the public sector dries up and unemployment rises) but should in theory be for the longer term greater good (as government workers who get paid by the taxes of others move into the private sector and create goods and services that increase the productive capacity of the economy simultaneously reducing the tax burden to balance the budget while increasing goods/services).
Even Dalio in a recent interview said that the U.S. needs to get th budget deficit to 3% to prevent longer term government debt issues.
The economic advisers to Trump will have been in his ears telling him the probable consequences of what Musk and DOGE are doing (and had planned before taking office) but he’s going ahead with it regardless. So he knew the consequences but has made a decision that it’s for th greater good.
We may not know the benefits for years - but people will judge the decision as a failure immediately or within months without seeing the bigger picture (that spans years or decades).
I agree it needs doing, clearly the current trajectory is not sustainable. I strongly doubt that it will be achieved. I think the cuts are overblown, and any savings will be counterbalanced by tax cuts. If they were serious they'd be looking at sensible cuts and sensible revenue increases.
The cuts can only be achieved by hitting defence spending, which they have said will increase, Medicare which they said would not be touched, or Medicaid which would hurt Trump's new working class base the most. The targets cannot be achieved from other federal spending.
Then you can add in the recent UK experience if austerity - once you start cutting and affecting the economy you find that tax revenue falls and welfare spending increases and that deficit target keeps receding into the distance.
The deficit does need to be cut, and anyone approaching that seriously would look at tax rises or reforms as well as spending cuts. I don't think this team are serious - the deficit talk is just a way to get the political agenda through and give Trump leverage in his classic mob boss style.
I will judge the results by the government deficit in 4 years time, and I'll be amazed and apologetic if it is at or near 3%.
"should in theory be for the longer term greater good (as government workers who get paid by the taxes of others move into the private sector and create goods and services that increase the productive capacity"
Have you given any thoughts as to what the consequence of thousands of government workers entering the private work force, and hence competing with existing employees will do to wages in a recessionary environment ? It will drive wages down ! It's another move to make the rich richer and the poor poorer IMO.
If the whole ship is sinking (which America is financially - please read Changing World Order by Dalio if you haven’t yet) then it’s best to keep the vessel afloat first then worry about the whinging later - for it is better to be alive but poorer than dead.
In regards to your point above wages could be lower but in theory taxes could be as well so net result may be marginal - what a sacrifice make to save your country from financial default and loss of reserve currency status.
I have read Ray Dalio's "Changing world order" and yes, I agree that the USA is finanically sinking.
Well done then you understand action is required and that will be a painful adjustment. Just like a house living beyond their means, adjusting to the new way of living to get th books in order isn’t pleasant when you first make the adjustment.
I have read Dalio's book, I didn't say I'm accepting all his views (that's what they are) as gospel, because I have also read many other economists and philosophers work.
the bigger picture (that spans years or decades).
The bigger picture of widening the gap between the rich and the poor is unchanged - only now it's going at a faster pace.
Yes, but the whole ship is sinking.
You can't just fixate on the rich/poor divide
:)
When the Titanic sank, guess who died and who escaped on the life boats ? The rich or the poor ?
Some of the rich had a moral code and withdrew.
And many of them died.
And many of them probably realised their ideas of 'rich' were flawed.
Really ? So you're trying to convince me, or perhaps yourself, that the wealthy passengers who got onto the life boats thought: "I would far rather be poor and locked in the lower decks about to drown".
Wake up and get real.
Do you really live if others sacrifice their lives for you because you are wealthy? I’d personally live in guilt and shame which really isn’t living at all.
Well, then you should live in shame and guilt daily. Hundreds of millions live in poverty for you and I to buy stuff cheaply and live comfortably. The difference between you and I is simply that I do acknowledge this.
Faster than when? Faster than when the political left/Biden were in power 3 months ago?
Are you blaming Trump and Biden or only Trump for the wealth gap? Even though the political left have done zero to reduce it.
Two points to consider...time horizon and relativity
interest.co.nz needs an experienced business or economics journalist
That's a promising sign, less than two weeks after limiting the comments section for "contributors" only. Good luck finding a great candidate.
“Or economics journalist.” Trust the successful applicant will not be anticipating finding PDK in his or her fan club.
I was anticipating writing to DC, pointing out the myopic curtailment in the job description.
Bravo!?
We have had an unsatisfactory interchange thus far - I pointed out that it was the truth that there were Limits to Growth, and that energy underwrote money. He, as I recall, called that 'my truth'. Presumably meaning it wasn't his.
I have some sympathy for those who chose to bet on a lame horse - but not too much.
The Chinese have a thorium reactor running.....
So?
I'm guessing you're not in the list here:
https://dothemath.ucsd.edu/2015/04/programmed-to-ignore/
Those who are, would realise that a thorium reactor isn't a universal answer :)
PDK, the earth may be finite but the universe isn't. This matters because ultimately, all energy on earth comes from the universe (if you can't understand this, you should be able to realise that some of our energy comes from our sun). Also, I believe you underestimate mankind's ingenuity and inventiveness at finding solutions, especially existential solutions.
Oh I’m then the ultimate doomster. Give or take a billion years, here or there, the sun must burn out. Therefore is it not then that the human race, in its own admittedly destructive way, is simply making hay while the sun shines?
"simply making hay while the sun shines". Nicely put, Foxglove.
Yes, the sun will burn out in a few million years. Science, innovation, space travel etc will move so far ahead of what we can understand today in these years too. Just 200 years ago we had no heating, plumbing, cars, planes, communication devices etc...
You make some silly comments, but that is right up there.
I have ALWAYS said out input is from the sun. Have you not read my pieces?
The rest of the universe is too far away, and the energy from it too dilute. It doesn't count.
And human ingenuity cannot overcome the 2nd Law of Thermodynamics.
Sheesh...
"And human ingenuity cannot overcome the 2nd Law of Thermodynamics"… YET.
PDK, had you lived a few centuries ago, you would swear that the earth is flat and that man cannot fly, because your mind doesn't allow you to contemplate what cannot be explained by science today.
The win by T&G for ENVY apples in China, confirming at the highest level of their court system an earlier decision by a lower court, also has implications for NZ kiwifruit. It confirms that NZ can rely on the Chinese court system through to the highest level in relation to plant variety rights IP. New Zealanders should reflect on what this says about trading with China.
KeithW
The win by T&G for ENVY apples in China, confirming at the highest level of their court system an earlier decision by a lower court, also has implications for NZ kiwifruit.
Non-Zespri gold kiwifruit variety already available across Asia.
That raises a question as to where those kiwifruit might be coming from. If an unlicensed entity is cross-border shipping gold kiwifruit produced from G3 (Sungold) plant material they are taking a big risk, and if they do it at scale they will be caught. There are of course Chinese varieties of gold kiwifruit (essentially unimproved varieties) that are not covered by NZ-owned IP.
KeithW
There are of course Chinese varieties of gold kiwifruit (essentially unimproved varieties) that are not covered by NZ-owned IP.
So how do you identify if IP has been used? My first thoughts were that perhaps this was brought to mkt without considering taste, etc. But I don't really know. One of the distributors is a Thai company with presence across wholesale, retail.
A DNA test is conclusive.
If G3 (Sungold) plant stock is the source then a lab analysis is not difficult.
KeithW
"Zespri now estimates there are more than 5,000 hectares of counterfeit SunGold in China, predominately in the Sichuan Province. "
https://www.abc.net.au/news/2021-06-02/china-new-zealand-kiwifruit-trad…
Actually, there are more than 5000ha of SunGold in China. But most of those orchards are very small. The IP issues relate to civil IP, not criminal law. So it is not up to the Chinese Government to deal with the issue. It is up to ZESPRI, through the civil courts. The Chinese Government from the outset quietly said to NZ that there are both smart and not so smart ways of trying to deal with this. However, ZESPRI failed to get support from its shareholders for the smart way. It is a long story.
KeithW
I can't help thinking it is China trying to look more trust worthy to the World. There is a competition going on in the World at the moment and I think China may well win.
They are certainly looking like a more reliable ally than the Americans are the moment.
Trade and Investment Minister Todd McClay today announced the appointment of Charles Finny as Chair of the Board of NZTE.
We're obviously not going for commercially minded people with energy and market experience.
https://www.miragenews.com/new-chair-takes-helm-at-nzte-1423264/
I am puzzled by your comment in regard to the new NZTE chair!
KeithW
I think the position is better suited to someone like Chris Luxon. It appears that this is what he wants to be doing.
Quite openly Luxon had a burning desire to be PM. However now that he is, it would seem apparent he leapt in before he looked in. Neither a natural nor comfortable fit. Not sure he knows what to do about it either.
What I am saying to you
What I am saying to you is
What I am saying is
and the rest of the song vanished round a corner in the road
:)
“Lost in a Lost World.” Courtesy Moody Blues. Fifty years hence or a la Graham Bonnet (Marbles) - “No one Listened to My Song.”There you go, there’s a step back melodically speaking, better than rap by the way.
Find the steepest ski run you have the balls to do
play it loud, top to bottom Mt Hutt works
Prefer Butthole Surfers - Pepper
I used to hang-glide to Atom Heart Mother (Pink Floyd) on the Sony walkman - my mate reckoned he could tell where I was on it by my flying.
Drive still to 'Song is over' (the Who)
and sail to Renaissance's Ocean Gypsy...
But the best live rendition of all time, Foxy doesn't like: https://www.youtube.com/watch?v=47e_961OQWE
Thanks. I hear it. I wear it. Now I need to try and sleep on it.
My word, IT Guy, what a super link!
Have a look team. Feel like a bourbon and coke now.
Roy Morgan poll Feb confirms tie (note different minor party results from recent Curia/TPU Poll)
"Roy Morgan’s New Zealand Poll for February 2025 shows the National-led Government (National, ACT & NZ First) on 47.5% (down 2.5% points) tied with the Labour-Greens-Maori Party Parliamentary Opposition on 47.5% (up 1% point).
There were changes in the composition of support for the National-led Government with National down 2% points to 30.5% and NZ First down 2.5% points to 6%. However, coalition partner ACT increased their support, up 1% point to 11%.
For the Parliamentary Opposition, support for Labour increased 0.5% points to 29% and support for the Greens jumped 4% points to 15.5% - the highest level of support for the party for exactly a year since February 2024. In contrast, support for the Maori Party dropped 3.5% points to 3%."
https://www.roymorgan.com/findings/9863-nz-national-voting-intention-fe…
That was taken before Seymour put his head in the oven
I was in that survey ……
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