Here are the key things you need to know before you leave work today.
MORTGAGE RATE CHANGES
Simplicity has cut its floating rate for ballot-winning FHB members to 2.25%, a drop of -25 bps.
TERM DEPOSIT RATE CHANGES
ANZ has cut term deposit rates, again. BNZ and the Bank of China also cut. And we missed a Wednesday Kiwibank cut to TD rates as well. It's getting closer to the point where rates above 1% will look 'good'. At least one bank, Heartland, still has a 2% offer for 2 years. It's a lone stand.
COST OF CAPITAL GOODS RISING
With consumer inflation low (1.5%) and producer input (+1.0%) and output (+0.3%) costs low as well and in the +1% range or lower, the cost of new investment in capital goods is rising at more than double the rate, another inhibitor to increasing investment. Capital goods inflation is running at +2.3% in the June quarter. Even though this is its lowest since 2004, it is rising noticeably higher that other prices.
WINNERS & LOSERS
On the farm non-livestock costs are rising at a low rate too (+1.0%). But there is large variability between different types of farms. For example, dairy farm costs are rising at the rate of +2.3% per year while those for sheep & beef units are falling at the rate of -1.2% per year
INTERESTING
We found this interesting.
VOLATILE SPARRING
The gold price is taking it on the chin today, and then making a half recovery. Yesterday at this time it was at US$2,006/oz. It ended down -US$76 in New York trade at US$1,930/oz. Now in Asian trade it is back up to US$1,947/oz. The net of all that is a -2.9% drop. On the same basis, silver has fallen -2.2%. Interestingly, this is more volatility than bitcoin.
IT'S NOT ONLY PMs
In heavy trading, the iron ore price is still rising.
FLOOD WATCH
The flooding if the Yellow River and Yangtze River basins has disrupted millions. It is about to peak. It is late in their rainy season for this to be happening. All eyes are on the integrity of their major river dams, one of which, the Three Gorges Dam is the world's largest.
EQUITY UPDATES
The S&P500 fell away at the end of the session in New York today, closing down more than -0.4%. That followed European markets last night that were up about +0.8%. Today, Shanghai has opened down -1.1%. Hong Kong has opened almost -2.0%. Tokyo is down -0.7%. In Australia, they are all lower too with the ASX200 shedding -0.9% in early afternoon trade. Here the NZX50 Capital Index is down -0.5% after being higher in the morning session.
SWAP RATES UPDATE
Swap rates are little-changed today, a little softer at the short end, a little firmer at the long end. The 90-day bank bill rate is down -1 bp at 0.27%. The Aussie Govt 10yr is unchanged at 0.87%. The China Govt 10yr is up +3 bps at 3.02%. And the NZ Govt 10yr yield down -1 bp to 0.66% and a new all-time low. The UST 10yr is up +1 bps at 0.67%.
NZ DOLLAR HOLDS
The Kiwi dollar is lower at 65.6 USc. Against the Aussie we are firmer at 91.4 AUc. Against the euro we are also firmer at 55.4 euro cents. All those changes cancel each other out and the TWI-5 is unchanged at 68.7.
BITCOIN SOFT
The price of bitcoin has fallen back again today, down another -1.6% to US$11,753. 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 ».
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