Here are the key things you need to know before you leave work today.
TODAY'S MORTGAGE RATE CHANGES
There are no changes to report today.
TODAY'S DEPOSIT RATE CHANGES
BNZ has taken a -10 to -15 bps sliver off all its term deposit rates today, and -10 bps off its Call and Online Call savings accounts.
IN THE ZONE
Our services sector remained in the zone of healthy expansion, according to the BNZ - BusinessNZ Performance of Services Index. The proportion of positive comments from the survey in July (64.1%) was up on June, with respondents outlining new business/orders and product development as key ingredients for influences on activity. These latest readings are solid from the service and manufacturing sectors and shows there were still other factors driving decent local growth.
DOWN, BUT UP
Japan's economy contracted in the April-to-June quarter, but managed to perform slightly better than expected, data released Monday showed. It was down -1.6% in Q2 after the surprising spurt in Q1 of +4.5%. Coming in 'better than expected' will ease many worries in Japan.
ALL OVER
The Chinese yuan reference rate was set today virtually unchanged. Their 'devaluation' looks like it is over, less than a 5% adjustment. A currency skirmish rather than a 'war', it seems.
TOP OF THE PYRAMID
The bosses of our bank bosses are about to report their salaries. First up is Kiwi Ian Narev who is the CBA's CEO. (The CBA owns ASB.) He earned AU$4.25 cash in the year to June 30 (NZ$18,500 per weekday) plus another another AU$1.5 mln in cash bonuses deferred from previous years and AU$2.2 mln worth of shares. That totals AU$8 mln, down slightly from the previous year. His rivals at ANZ, NAB and Westpac will all report later in the year because they have a September 30 financial reporting year end. Last year ANZ's Mike Smith topped them all taking home AU$10.7 mln.
NEW BONDS, NEW DIRECTION
Contact Energy said today it will issue up to $125 million in new unsecured, unsubordinated fixed rate bonds. Contact also announced it was closing its gas-fired Otahuhu power plant in Auckland and will rely on renewables for the capacity. This move follows Genesis' recent decision to close the coal-fired Huntly power station. Fossil fuels are out and NZ is closer to meeting its greenhouse gas commitments.
WHOLESALE RATES UNCHANGED
Swap rates were pretty much unchanged today, just down -1 bp for terms 1-3 years. But the 90 day bank bill rate is down another -4 bps to 2.90%, pricing in more than one OCR cut.
NZ DOLLAR HOLDS
The NZ dollar has changed very little today, still at 65.4 USc, at 88.7 AUc, and 59 euro cents. The TWI is at 69.9. Check our real-time charts here.
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4 Comments
Looking forward to tomorrow's soil moisture maps. Nathan Guy came down on Friday to formally extend the drought-support provisions for North Canterbury. We immediately got two days of steady rain. Very welcome - thanks, Nath.
Given how well Key's forecasts for the NZD, Fonterra etc have worked out we may have discovered a new pattern emerging for this government. Declare something to be so and watch real life go in the opposite direction.
PS Louise Upston also did well getting Parliament to wish the Silver Ferns every success.
Re; the BNZ service sector survey - anyone reading the above 'review' would be surprised to read that the survey actually showed worsening conditions:
http://www.nbr.co.nz/article/nz-service-sector-activity-slows-july-dair…
''The BNZ-BusinessNZ performance of services index fell 1.6 points to a seasonally adjusted 56.5 last month, its lowest level since February this year. ''
''Four of the five sub-indices fell in July, while all remaining in expansion. Activity/sales edged higher to 60.4 last month, from June's reading of 60.1 Stock/inventories slipped to 51 from 53.4 in June, employment declined to 53.8 from 54.1, new orders/business dropped to 60.4 from 62.7 and supplier deliveries fell to 54 from 55.6.''
The manufacturing survey has also turned down, thus:
''The PSI follows a souring gauge of the manufacturing sector last week, where the BNZ-BusinessNZ performance of manufacturing index dropped to 53.5 last month from 55.1 in June. The performance of the composite index, which combines the two measures, decreased 1.7 point to 56 on a GDP-weighted index, while the free-weighted index fell 1.5 points to 55.6.''
Pretty clear which direction that is all going in.....
Lets face it , if 2014 was a phony currency war year , then 2015 is Game - On with the Chinese devaluation putting a real spanner in the works .
The Chinese have done it properly , throwing the first big punch and then telling everyone not to worry
DO NOT BE FOOLED
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