A review of things you need to know before you go home on Thursday; business outlook survey; RBNZ committee; employment confidence; work arrangements; tenancy compliance; rates lower; NZD stable

Here are the key things you need to know before you leave work today.

MORTGAGE RATE CHANGES

TSB has shaved four basis points off both its two-year "special" rate and two-year carded rate. The former is now 3.95% and the latter 4.45%. TSB also says its price match campaign, through which it's matching any nationally advertised home loan rate from ANZ, ASB, BNZ and Westpac, continues until further notice. (It turns out that TSB's advice was in error. Sorry.)

Late yesterday, Kiwibank said it will move to a 4.29% five year fixed rate on Monday. That is far below any rival offers.

TERM DEPOSIT RATE CHANGES
No changes here today.

REMINDER
From April 1, the new minimum wage rates, before tax, are: Adult = $17.70 an hour, Starting-out = $14.16 an hour (up from $13.20), Training = $14.16 an hour (up from $13.20).

BUSINESS OUTLOOK SURVEY
In the March ANZ Business Outlook Survey headline business confidence fell 7 points. A net 38% of respondents reported that they expect general business conditions to deteriorate in the year ahead. Firms’ expectations for their own activity eased 5 points to a net 6% expecting a lift. The services sector is the most optimistic, retail the least.

RESERVE BANK COMMITTEE
A new independent decision-making body at the Reserve Bank brings a broad range of experience to important decisions like setting interest rates and how monetary policy can support maximising employment in the New Zealand economy, Finance Minister Grant Robertson says.

LOWER PAYOUT
Lower than expected sales have seen Westland Milk Products lower its predicted payout range for the 2018-19 season to $5.80 - $6.00 (previously $6.00 to $6.20). Last quarter’s very high sales targets for infant and toddler nutrition (ITN) will not be met, the company says.

EMPLOYMENT CONFIDENCE
Confidence in the labour market fell in March, reversing the strong rise seen in December. Perceptions about job opportunities were down slightly, though this was in proportion to the recent swings in the unemployment rate. Workers’ views on past and future earnings growth were particularly downbeat. That stands in contrast with employers’ concerns about rising costs and the difficulty of finding workers. Given the tight labour market, we expect some pickup in wage growth over the next couple of years. But today’s survey raises questions about the extent of that pickup.

ANZ REVISES OCR OUTLOOK
The surprisingly dovish tone taken by the RBNZ in its Wednesday OCR review announcement has prompted ANZ economists to take a more dovish approach too. They now see the RBNZ cutting the OCR by 25 basis points in August, rather than in November as previously forecast. From there, they expect to see another cut in November and then again in February 2020. They had previously forecast a cut to 1.00% by later in 2020. Other bank economists on Wednesday revised their OCR outlooks. Most had picked the next move to be a hike in 2021, but now expect the next move to be a cut, possibly as soon as May.  

CROWN ACCOUNTS
Core Crown tax revenue of $53.9 billion was $0.1 billion (0.3%) below forecast. Within this, corporate tax was $0.4 billion below forecast mainly owing to below-forecast provisional tax estimates and assessments. This was partially offset by customs and excise duties being $0.2 billion higher than forecast. Core Crown expenses of $56.2 billion were $0.7 billion (1.3%) below forecast. Of this, around $0.2 billion related to education expenses that were lower than forecast as a result of demand-driven factors across all sectors. Social assistance benefits and impairments of sovereign receivables were also $0.2 billion below forecast. The remainder of the variance was spread across a number of areas. The operating balance before gains and losses (OBEGAL) was a surplus of $2.2 billion, $0.3 billion higher than forecast. This was largely driven by the core Crown results already discussed.

HOUSING NZ BORROWS $500M
Housing New Zealand has issued $500 million worth of seven and-a-half year sustainability bonds. Issued at a margin of 34 basis points, the unsubordinated, unsecured medium term notes have an issue yield of 2.247%.

WORK ARRANGEMENTS
New Zealand businesses provided flexible leave and work arrangements in 2018 in one form or another, Stats NZ said today. This result is from the annual business operations survey, which is a sample survey that reports on businesses with six or more employees. Almost two-thirds of businesses reported they had formal arrangements to allow employees to use personal sick leave, unpaid leave, or compassionate leave to care for other people who were sick. The financial and insurance services industry had the largest proportion of businesses (79%) providing this type of leave arrangement. In contrast, only 10% of businesses overall offered childcare-related allowances or facilities. These options were more popular in the education and training industry, and were provided by 35% of those businesses.

FIBRE OPTICS
More than half of businesses used fibre-optic broadband connections in 2018, Stats NZ said today. This result is from the annual business operations survey, which reports on businesses with six or more employees. Fibre-optic connection allows extremely fast broadband speeds and is much faster than traditional copper-wire connection. Stats NZ are seeing more and more businesses taking up fast broadband. Fibre usage has more than doubled to 52%, compared with four years ago. Access to faster broadband is seen as an important factor in enabling increased productivity and promoting economic growth. The financial and insurance services industry had the highest proportion of businesses already using fibre (82%). This was followed by the professional, scientific, and technical services industry at 78%. Businesses in this industry include scientific research, legal and accounting, advertising, and computer systems design services.

TENANCY COMPLIANCE
The Tenancy Tribunal has recently made orders totalling nearly $17,000 against three landlords as a result of investigations launched by the Tenancy Compliance and Investigations Team. In the largest of the three cases, Auckland boarding house landlord Peter Wheeler was ordered to pay $12,344.64 for failing to lodge tenants’ bond money as required by the Residential Tenancies Act. The Tenancy Tribunal Adjudicator described the actions of Wheeler, who owns five boarding houses across Auckland, as being “intended to avoid the need to forward bond money to the Bond Centre” and “to avoid future scrutiny by the Tenancy Tribunal”. In the second group of Orders, Wanganui Home Maintenance Limited was ordered to pay $3563.52 across eight applications for failing to lodge bonds, failing to maintain the premises, and providing misleading insulation statements which the Adjudicator said “…indicate[d] to the tenants that there was some insulation in the ceilings, which was not the case at all”. In the third application, Wellington Landlord Perry Rama agreed to pay $1000 after he allowed tenants to return to their rented property while it was still the subject of a ‘Dangerous Building Notice’ issued by the Wellington City Council. He also agreed to pass the management of the properties on to a property management company.

ASIA PACIFIC CREDIT CONDITIONS EASE
The US Federal Reserve's pause on interest rate hikes and China's loosening of its credit purse strings have eased conditions. Yet, economic growth remains soft and macro risks persist. That's according to S&P Global Ratings in a report published today, titled "Credit Conditions Asia-Pacific: The Fed Pauses, China Eases".

LOCAL SWAP RATES LOWER
Local swap rates have fallen, with the two year down 3 basis points from yesterday, the five year down 2 basis points and the ten year down 2 basis points. The 90 day bank bill rates are down 2 basis points at 1.83%.

NZ DOLLAR STABLE
The NZ dollar is down to US67.9c. On the cross rates we are at AU95.9c and €60.4 cents. The TWI-5 has fallen to 72.4.

BITCOIN UP
Bitcoin is at US$4,033 and up a little from this time yesterday.

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