Here are the key things you need to know before you leave work today.
TODAY'S MORTGAGE RATE CHANGES
The Co-operative Bank today dropped its 18 month home loan rate to 5.49% which is lowest 18 month rate in the market.
TODAY'S DEPOSIT RATE CHANGES
There have been no TD rate changes today.
DAIRY PRICES JUMP
With lower volumes offered, prices rose +9.4% overall in US dollar terms from the previous auction two weeks ago, but were up a spectacular +15.4% in NZ dollar terms due to the meaningful falls in the kiwi dollar over the past two weeks. This early morning action set the tome for the day.
LOCAL GOV DEBT POPULAR
Today's LGFA $120 mln bond tender was well supported being more than 3 times oversubscribed. Yields fell -40 to -80 bps across the curve from the prior auction.
'I'M NOT GOING TO CUT'
RBNZ governor Wheeler today argued for OCR stability; saying he is monitoring the role of the banks in generating Auckland house price inflation. He did not indicate anything about new macro-prudential tools. The NZ$ rose on his comments.
BIG JOB GAINS
The December unemployment rate surprisingly rose in the December quarter to 5.7% but labour force participation rate also rose reaching a record high of 69.7% with a 'turbo-charged' increase in the labour supply. There are wide regional variations worth checking out.
WHEN WILL WAGE GROWTH TAKE OFF?
Labour costs in the December quarter were up only +1.8% from a year earlier, and average hourly wages rose +2.7% over the same period. With GDP growth strong, the employment rate reaching levels unseen since 2008, and reports of shortages of both skilled and unskilled labour, it is surprising to see wage growth remain so subdued. But these are 'real' increases with inflation running less than 1%.
LOW SUPPLY FORCES PRICES UP
Barfoot's sales volumes and prices in the booming Auckland market held steady in January but the median price rose by $120,000 over the past year. Listings are short. 20% of their January sales were for more than $1 mln.
RETAIL STARTS 2015 STRONGLY
Strong January retail sales have set up the new year for 'continued growth during 2015' says Paymark. Growth is especially strong in Auckland, despite recent falls in petrol prices. Wellington retail is a laggard.
NOT PAYING BACK YET
As at January 2014 there were $79.4 bln of Govt securities on issue, down marginally from December.
HOME LOAN ACTIVITY UP
Last week there were 5,700 mortgage approvals worth $1.1 bln and averaging nearly $200,000 per loan. Many will be roll-overs. All these levels are much higher than the same week a year ago.
SITUATION VACANT
ASB is looking for a senior economist now that the talented Christina Leung has left the bank.
WHOLESALE RATES LOWER
New Zealand wholesale swap rates are down about -2 bps today despite rises in benchmark yields in New York last night. The hawkish Wheeler speech moved local markets for terms less than 5 years. But for 10 yr swaps, rates rose +3 bps. The 90 day bank bill rate was down to 3.62% before the Wheeler speech but moved back up to 3.64% after.
NZ DOLLAR HIGHER
Check our real-time charts here. The NZ dollar is up strongly on the combination of stronger dairy prices and the Wheeler speech. It is now at 74 USc and it touched 95 AUc before slipping a bit to 94.9 AUc, and the TWI is now at 77.
You can now see an animation of this chart. Click on it, or click here.
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