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.
TERM DEPOSIT/SAVINGS RATE CHANGES
TSB cut short rates, and two at the very long end. All updated term deposit rates less than 1 year are here, for 1-5 years, they are here.
MORE SUPPLY
There has been a surge in new housing completions in Auckland at the start of 2025, setting a new record for the month of January.
MORE OVERCHARGING
The FMA has filed court proceedings against IAG NZ for allegedly overcharging 269,000 customers $35 million, breaching the Financial Markets Conduct Act. It is another self-reported case.
WHEN WE WERE LAST AT THIS LEVEL ...
Today the one year swap rate could be at 3.20% and that takes them back to April 2022 levels. And back then, the OCR was 1.50%, one year home loan rates were 3.95% and one year term deposit rates were 2.50%. Just saying ...
NZX UPDATE
As at 3pm, the overall NZX50 index is down -1.1% and the weekly change is now -0.7%. Year-to-date it is down -6.6%, and the change from this time last year is now +1.4%. Decliners dominated led by Gentrack and Skellerup. Among the few gainers were Heartland, Meridian, and Contact. Market heavyweight F&P Healthcare was down -2.8%.
UNINSPIRING
In Australia, data out today on household spending shows a small +0.2% rise in February from January, but a -0.6% dip from February 2024.
THEY DUG THEMSELVES A HOLE ... TO QUCKSAND
We should also note that the US dollar fell -2.2% on April 3 (US time) and this is reputed to be the largest one-day fall ever for the greenback. Since the week after Inauguration Day, it has fallen a massive -7.4%. Although the current Administration may dismiss it as barely relevant, and a help for American exporters, it is really important for the stability of the inward capital flows they depend on. They are now at risk, right at the time inflation is expected to zoom, another factor that will undermine those flows. Without them the greenback could sink further and faster, accentuating economic instability. What will the Fed do? It is a key question for them and any remedy is unlikely to be favoured by the President. They don't formally meet until May 8 (NZ time), but you can be sure they are huddling now and watching closely. We will be watching the tone of Fed speakers in the longsih period until they go embargo quiet before that meeting.
ARE THEY COMING FOR OUR BIOSECURITY PROTECTIONS?
In a CNN interview, Trump's Commerce Secretary took aim at Australia's biosecurity protections, calling them a tariff by another name. That probably means they are coming for our biosecurity protections too. This could well be a defining spat between New Zealand and the USA.
SWAP RATES DROP HARD
Wholesale swap rates are probably a lot lower today following bond yields down, maybe by as much as -10 bps. Even the short rates are lower. 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 3.59% on Thursday. The Australian 10 year bond yield is down -8 bps at 4.23% to new lower levels. The China 10 year bond rate is down -1 bp at 1.79%. The NZ Government 10 year bond rate is down -8 bps at 4.42% while today's RBNZ fix was at 4.39% and down -4 bps. The UST 10yr yield is now just on 4.01% and down -6 bps from this time yesterday. Their 2yr is down -15 bps at 3.66%, so that positive curve has now jumped to +35 bps.
EQUITIES REACT TO TARIFF DETAILS
The NZX50 is down -1.1% in late Friday trade, as the tariff news sinks in. The ASX200 is down -1.7% in afternoon trade. Tokyo has opened down another -2.5% in early Friday trade. Hong Kong is down -1.5%, while Shanghai is down -0.2% at its open. Singapore has opened down -1.9%, a very large drop for them. On Wall Street, the S&P500 was down -4.8% in Thursday trade, and the overall American equity market shed more than -US2.5 tln. Poof! Pretty soon you'll be talking about real money.
VOLATILITY WATCH
A key metric we are watching is the VIX volatility index. It is now its highest since the brief August 5, 2024 Japanese stock market crash. And prior to the elevated pandemic period, the highest since the GFC.
OIL DROPS
The oil price is -US$3.50 softer from this time yesterday and now just over US$66.50/bbl in the US, and just under US$70/bbl for the international Brent price.
CARBON PRICE DROPS FURTHER
The carbon price is down another -50c/NZU today and now at NZ$54/NZU. It hasn't been this low since August 2024. The next official carbon auction is on Wednesday, June 18, with a $68 floor price. See our new daily chart tracker of the NZU price for carbon, courtesy of emsTradepoint.
GOLD DROPS
In early Asian trade, gold is down -US$46 from this time yesterday, now at US$3108/oz.
NZD FIRMS AGAIN
The Kiwi dollar is up +40 bps from this time yesterday at 57.8 USc. Against the Aussie we are up +30 bps at 91.6 AUc. Against the euro we are down -40 bps at 52.2 euro cents. This all means the TWI-5 is just under 67.2 and up +20 bps from yesterday at this time.
BITCOIN EASES AGAIN
The bitcoin price is down a net -1.4% from this time yesterday, now at US$82,704. Volatility of the past 24 hours has been modest at just on +/- 1.5%.
Daily exchange rates
Select chart tabs
Daily swap rates
Select chart tabs
This soil moisture chart is animated here.
Keep abreast of upcoming events by following our Economic Calendar here ».
20 Comments
We should also note that the US dollar fell -2.2% on April 3 (US time) and this is reputed to be the largest one-day fall ever for the greenback.
Important to remember that USD hegemony is part of the problem. Does Trump want a strong dollar? I don't necessarily think so. After y'day, I pointed out to the water cooler crew to remember the 1985 Plaza Accord. They had no idea what I was taking about. It was all about trade imbalances between the US and Japan / Germany. JPY strengthened 60% against USD following this event.
And let me rewind to 2010 when it printed $1.25T with just one purchase. That's a lot of Nikes. The reason the American Empire had the right to print a trillion dollars at its whim is because it was managing the global financial system for everyone. So it had the right to impose global taxation via dollar inflation. Every time it printed $1T, that was divided by the 6 billion+ direct and indirect dollar holders worldwide, not just 330 million Americans.
The whole world has paid the US to run the empire. And they got diluted down every time the US printed another dollar.
"Does Trump want a strong dollar?"
He wouldn't have a clue what affects currency markets. Please keep your questions very basic when referring to Trump.
Isn't that like the pot calling the kettle black Dr Y?
Further to this, Trump and Bessent have signaled over the last two months, prior to the final tariff announcement, that they wanted USD lower, the long end yields down, and they didn't care what the market did.
MORE OVERCHARGING
The FMA has filed court proceedings against IAG NZ for allegedly overcharging 269,000 customers $35 million, breaching the Financial Markets Conduct Act. It is another self-reported case.
Premiums will no doubt have to rise again to cover this new shortfall in revenue.
Off-the-plan apartment component of the Aussie Ponzi. Just wow. Rivers of gold.
"This quarter recorded the highest quarter-on-quarter growth in the past five years, with the average price per square metre surpassing $19,000— a 24% increase since Q3 and a 34% rise year-on-year from Q4 2023 The primary driver was off-the-plan projects in Brisbane, where square metre rates exceeded $23,000, marking a 33% quarter-on-quarter increase"
https://urbis.com.au/insights-news/urbis-apartment-essentials-national-…
<spruiker=on>=" but interest swap rates are going down fast, houses must go up "
The Comb - https://www.oneroof.co.nz/news/tony-alexander-the-big-reason-why-prices…
For the many people out there accounting for the 40,000-plus properties currently listed for sale, my message is this: there are buyers interested in purchasing, but they enjoy the best range of properties to choose from since 2015 and won’t tolerate vendors playing games. When it comes to the negotiations you are the one who will need to blink.
You loose all credibility sharing TA...
ITG used to agree with you, and discredit TA himself. Now that TA writes what ITG believes, ITG has become a big fan, and he has quoted TA multiple times recently.
Exactly, makes it even more embarrassing.
I've been reading TA since he was with the BNZ, he is always careful to frame & backup his opinions with comprehensive evidence & analysis.
That means he's as credible as any other economist, it doesn't mean he's never wrong. However he's more often right & right in advance of some other opinions.
Dow nosedives 1,600 points, S&P 500 and Nasdaq drop the most since 2020 after Trump’s tariff onslaught
JP Morgan now see's 60% chance of US Recession
Has the takeover of US democracy provided Europe with an opportunity to shift capacity from US-bound motor vehicles, electronics and aircraft, towards building its defence capability?
If you're going to have to subsidise something, might as well be directed towards protecting Europe's joint borders?
Up until 1917 the Europeans were making a mess of things all on their own. And up until 1941 they were repeating the exercise. At the close of 1945 Europe had an iron curtain, courtesy of the dreaded Reds, enveloping the territory of north and east of the continent. In the 1980s courtesy of Reagan’s USA that curtain was pushed right back not far west of Moscow. In summary of those efforts, thousands of American lives and US$ billions went east across the Atlantic never to return. Yet Europe at street level remains festooned with such as “go home yank.” Is it any wonder then that the Americans one day might conclude, enough is more than enough. So yes let’s see finally, just how good the Europeans are at taking care of themselves.
SWAP RATES DROP HARD
Any comments, Kraken ?
They're kraken their pants...
In the near future, lock in for five years. If tariffs stay, Fed and other central banks could start hiking end of this year. Fear trade into bonds while equities sell-off, RBNZ has room to cut next meeting.
Aussie pension funds cyberattacked. Imagine being rugged of your retirement savings due to tradfi's incompetency.
An unknown number of superannuation fund members have lost thousands of dollars of their retirement savings in what appears to be a co-ordinated cyberattack on Australia’s $4.1 trillion super sector.
As revealed by AFR Weekend, major industry funds Australian Retirement Trust, AustralianSuper, REST and Hostplus were all breached. Insignia, the owner of the 180-year-old MLC brand and the largest retail superannuation fund, also suffered a cyberattack.
AustralianSuper said 600 passwords had been breached, while Insignia said 100 of its members’ accounts had been tampered with. REST said 8000 of its accounts were affected. The websites and apps for several of the funds, including AustralianSuper and Hostplus, crashed on Friday afternoon as members rushed to check their accounts.
https://www.afr.com/companies/financial-services/cyberattack-launched-o…
We welcome your comments below. If you are not already registered, please register to 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.