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Here are the key things you need to know before you leave work today.
MORTGAGE RATE CHANGES
Resimac have trimmed their 3, 4 and 5 year fixed rates. More here.
TERM DEPOSIT RATE CHANGES
General Finance and Christian Savings have trimmed TD rates. More here.
LEVELING OFF
QV says housing values are now flattening around NZ, and starting to decline in Auckland, Queenstown and Dunedin. They say average dwelling values are still well up on a year ago but that annual growth rate is starting to tail off.
UNEXPECTED RETREAT
Dairy prices took an unexpected tumble today in the latest auction. This correction essentially wiped out most of the strong July gains.
LOCKDOWN PLAYS HAVOC WITH JOBS DATA
There was a barely believable labour market release from Stats NZ today for the June quarter. Despite the heavy hit the economy took in the April-June quarter, they report that the jobless rate fell (yes, fell) to under 4%. And the youth unemployment rate fell to just 14% and its lowest since before the GFC. If you find these results less than credible, then they say their Household Labour Force Survey shows the numbers of people unemployed dropped from March (124,800) to just 108,200 in June. All this happens because the participation rate fell and they say many people just left the labour market. At the same time the level of under-employment rose sharply. Also revealing was that actual hours worked were -9% lower in June 2020 than June 2019. More here. Just to give an indication about how 'rosy' this report is, the RBNZ was expecting this jobless rate to be 7.0% in their last MPS review, and yesterday, the consensus of economists polled was for a 5.8% jobless rate.
SMALL BUMP IN THE ROAD
There were 11,975 used imports registered in July (compared to 8,200 new cars in the same months). This is the same as for June but -6.4% lower than for July 2019.
'DEFYING THE ODDS'
The ANZ World Commodity Price Index gained +2.3% in July from June with strength in the dairy market driving the index back to its pre-COVID-19 levels. But as above, this may not last into August. Year-on-year, the USD index is -1.7% lower, and in NZD is unchanged from a year ago.
COVID-19 LESSONS REINFORCE THE VALUE OF PLANNING FOR CYBER SECURITY INCIDENTS
In an incident management report, the National Cyber Security Centre lists five steps to help business leaders and cyber security professionals strengthen their organisation’s ability to manage and respond to cyber security incidents. They are; define roles and responsibilities; identify threats and assets; have a plan; logging, alerting and incident automation; maintain awareness and report progress and continually improve.
MORE PRECIOUS
The price of gold closed in London at a record high US$1978/oz. Then in New York it closed up at US$2019/oz. In subsequent trading in our time zone it went even higher, up to US$2032/oz but has slipped back closer to the closing New York prices now. Silver's gains have been relatively higher.
TIGHTENING GRIP
Victoria has confirmed new 725 new coronavirus cases today and 15 deaths (both records). NSW has confirmed 12 today. Queensland has confirmed one, and has closed all entry from NSW and the ACT (it already is closed to Victorians).
EQUITY UPDATES
A late end-of-session surge saw the S&P500 end up +0.4% in New York. But it isn't a signal that markets in our time zone have responded to. The NZX50 Capital Index is down -0.3% in late trade, undermined by the Aussie banks and FPH. The ASX200 is down -1.0% in afternoon trade. Shanghai has opened down -0.4%, Hong Kong is flat. Tokyo has opened down -0.6%.
SWAP RATES UPDATE
Swap rates were probably unchanged today, possibly soft at the long end. We don't have final wholesale swap rates movement details yet, but we will update this later in the day if they show a significant different movement. The 90-day bank bill rate is unchanged at 0.30%. The Aussie Govt 10yr is down -3 bps at 0.82%. The China Govt 10yr is slightly softer at 2.96%. But the NZ Govt 10yr yield is -2 bps lower at 0.72%. The UST 10yr has fallen -5 bps to 0.51% today, a new record low.
NZ DOLLAR HOLDS
The Kiwi dollar has run just a little firmer today, now at 66.4 USc. And against the Aussie we are down -½c at 92.5 AUc. Against the euro we are also unchanged at 56.2 euro cents. And that means the TWI-5 is little-changed at 69.5.
BITCOIN STAYS FIRM
The price of bitcoin is also little-changed at US$11,170. The bitcoin price is charted in the currency set below.
This soil moisture chart is animated here.
The easiest place to stay up with event risk today is by following our Economic Calendar here ».
Daily exchange rates
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83 Comments
Everyone is struggling to cope with the fact that things are not as abysmal as expected. Also many, employees, businesses and banks like to paint a worse than actual picture of the future in the hope of getting more free money from the government and sadly, the government will probably oblige
Yeah, he was very predictable in his 'advice'. The man wants the government to relax border restrictions to soften Covid-19's economic blow.
Our border restrictions and other recent developments are really threatening the man's legacy : heaps of low-value tourism and hospitality businesses under existential threat, government drafting a plan to refocus export education sector on high value and low volume, employers forced to hire Kiwis over foreign workers at better wages, the nation's sentiments towards China turning sour... oh, the sorrow.
Here's some stats from today to show everyone how close to the edge we are:
- There are 452,000 New Zealanders on wage subsidies.
- Despite this, in the last quarter, the number of people not in the workforce rose by 37,000.
- the number of employed people fell 11,000.
- hours worked fell a record 10.3 percent.
The total number of hours actually worked in the June 2020 quarter fell 9.3 million hours (10.3 percent) compared with last quarter and decreased 8.2 million hours (9.1 percent) compared with a year ago. These were the largest decreases recorded since the series began in 1986.
Things really will be "that bad." It's going to be a disaster not only for the economy but for our society. All our government has done is delay the storm. And its probably made the eventual damage worse than it could have been. But I suppose there is an election to be won.
Food for thought....
https://youtu.be/Cp0hiFVm1U8
Peak Prosperity...
And some challenging Danish research numbers....
Puts a big spanner in the things.
Some people are struggling the realise that monumental debt with reduced income cannot continue forever. Either will the current debt forgiveness. The banks and JK are underlining that.
Popcorn.
Calls to flood NZ with more foreign cash and students is something no one in NZ ever voted for. Good that election will allow NZ taxpayers to underline that.
Double popcorn.
He also said this...
"Why don't we let in rich Americans who want to build a house in New Zealand? Who cares? They're in Mangawhai or somewhere, they are going to create thousands of jobs.
"Why do we care if someone who lives in New York wants to spend $10 million building a house in Auckland, using NZ craftsmen and NZ tradespeople?"
Well John...
Grabbing some silver is completely outside the square for me. I did hundreds of hours of research and then stand my ground when I approached my wife about it and argued my case. Yes I am bloody happy that I can report back to her and say that we have made $10k from that. Yes I am bloody stoked that I have made a good call so far.
As I am now an investor, I dont mind saying that I think it will go further and don't mind recommending it to others as this is an investment site.
Screw the stiff upper lip.
Well you might not understand the space then. As a PM investor, you have to be prepared for anything. It's not like having a good night at Sky City. You need to understand that silver in particular is highly manipulated by the likes of JPM. And whether you like it or not, the ruling elite sides with JPM, not you.
Gold and silver will come into play the more money is printed to play with so feel free to mock it but smart money is getting out of fiat and into anything that can protect against zero interest on bank deposits and overvalued equities.
It is the same story that has has played out before but this time the amount of money printing to prop everything up is off the scale.
Perhaps it's also the same story that was being told 10 years back ( Yes. back when money was being 'printed' ad infinitum) when silver was at NZ$60 and proponents were enthusiastically calling for $100. What happened? It went..... back to $20. C'est la vie. Perhaps this time it's different!
https://www.facebook.com/GeoffSimmonsNZ/videos/592726891613109/?t=4
TOP Party explaining how higher taxes will increase house prices.
Any younger generation voter would be wise to take a good look at TOP. make up your own minds, ignore the following rants.
Untill they gain traction it isn't worth reading what they have to say as it is a wasted vote.
Gareth Morgan too fresh in my memory for me to contemplate reading it.
One policy I do know of is that they want to bombard the entire country with poison.
They may have a few good ideas but there are some outrageous as well. Second election and better chance than average that it will be their last.
I have seriously heard about 10-20 people say they would vote for them, but it's "a wasted vote". I believe if everyone who actually wanted to vote for them did, they would be well past the 5% threshold. However the story of "wasted vote" told by the other parties ruins their chances.
They will only increase house prices if we continue to think the market can deliver housing at moderate prices. It can't, and it won't.
If the government builds homes that FHBs can buy then it doesn't matter what 'the market's is doing...
In fact, mass house building for FHBs, as per the 1950s,would pretty much prevent further house price booms...
TOP are just another variant on neo-liberalism.
please mike hosking can not even agree with himself in the morning, yesterday he contradicted himself all morning in his rants, one minute lockdowns are bad destroy the economy, next minute victoria should have locked down faster to get the virus back under control.
he has no idea what comes out sometimes, he just opens his mouth and sees what will come out.
thats why 1/2 the people listen to him because his is stupid and makes you laugh
Both are oxygen thieves
https://www.facebook.com/34497296301/posts/10157624927481302/?d=n
Yep. The minute Key gives advice means he’s either pumping something or shorting it.. but Kiwis loved the doubling of household debt during his tenure.. why?. - because house prices went up and more slaves were created of the young and the recently arrived migrants. - what was the name of the money lender in the merchant of Venice?
I see the GOVERNMENT purchased 12,000 pigs during the lockdown
I wonder why in the face of such supposed over-supply the price of my breakfast bacon cuts remained so stubbornly high ............... Bacon has not moved a cent in price at Pak n Save since the lockdown started ?
We might have bought more pork ( not the flying kind ) if the price was lower
That's because NZ pork is mostly sold through independent butchers who weren't allowed to open through lockdown. The supermarkets wouldn't take it, and the pig farmers were faced with having to shoot and dispose of their market ready pigs. I'm sure the food banks were happy to have it.
Good point this. I went to my local New World this evening and looked for New Zealand Free Range Bacon (yes I hate the idea of cages). Nothing. All I could find was "Made in NZ from overseas and NZ ingredients" - the NZ ingredient apparently being salt.
I'd have loved one of those carcasses, but also challenge our supermarket chains to support free range homegrown - there's more than me that will pay an extra dollar or two for the privilege.
Young Adam across the ditch knows what's up.
https://www.newshub.co.nz/home/new-zealand/2020/08/coronavirus-new-zeal…
i have been watching the news from across the ditch and there is no way any australian especially right wing will ever give any credit to NZ.
alan johns said this tonight,
"dont get me started on NZ draconian lockdown they have now destroyed their tourism industry."
Alan you dope that is because the whole world shut borders not just NZ and airlines stopped flying, countries all over the world banned everyone except citizens even australia, in fact australians have to ask permission to leave their country now we can still leave if a country will take us.
Australians can never give NZ credit it is just not in their DNA that we might do something better than them
check out the carton coming out tomorrow in the australian showing melborune in ruins because of the shut down and its people gone back to farming and comparing it to NZ as a put down
Sir John Key has lost the plot.
I can't believe I voted for him back in 2007. See! We all make mistakes...
https://www.nzherald.co.nz/nz/news/article.cfm?c_id=1&objectid=12354064
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