What happened Monday | interest.co.nz

Here are the key things you need to know before you leave work today (or if you already work from home, before you shut down your laptop).

MORTGAGE RATE CHANGES
Nothing changed today, again. We are unlikely to get many changes until the Reserve Bank releases its November Monetary Policy Statement on Wednesday afternoon. And then, a lot will depend on variation from what the market has priced in.

TERM DEPOSIT RATE CHANGES
Unity Money, and Gold Band Finance both raised TD rates today.

MORE CARD USE, BUT RESTRAINED
Total billings on locally issued credit cards hit $4.545 billion in October, which was a sharp recovery from the pandemic-damaged month a year ago. But it is up +9.3% from October 2019 which when you think about the intervening inflation, isn’t actually that impressive. Locally issued credit card billings inside the country are up +11.6% on the same basis, so a bit more evidence that a real spending recovery is taking place.

LOWER CARD BALANCES
Credit card balance growth is however restrained. We now owe $6.0 billion on all our credit cards, which is far below the $7.5 billion we owed in December 2019. Back then, 59% was interest-bearing. Now only 53% bears interest costs. This now costs us about $530 million in interest per year (at 18.6%), but in fact that is far less than the $730 million per year it cost us in December 2019 at 17.8% pa.

ECON101 PROOF
Although median rents up +$40 a week nationally in the September year, they are virtually unchanged in Auckland as housing supply catches up with demand. The next test will be for housing prices.

NO CHANGE
China reviewed its prime loan rates (LPR) today and left both the 1-year rate unchanged at 3.65% and their five-year rate unchanged at 4.30%. Most loans in China are priced from the 1-year LPR, except for mortgages which are usually based on the 5-year LPR.

PP LOG IN SORTED
The log-in issue many readers encountered last week when they tried to access our ad-free service is now sorted. We apologize for the outage. (Let us know if you still have issues.)

SWAP RATES SHIFT FIRMER
Wholesale swap rates may be slightly firmer today, but the real action comes near the close. Our chart will record the final positions. The 90 day bank bill rate is up +3 bps at 4.23%. The Australian 10-year bond yield is now at 3.61% and down -3 bps from Saturday. The China 10 year bond rate is still at 2.83%. The NZ Government 10 year bond rate is now at 4.25%, and up +3 bps and still above the RBNZ fix for the NZGB 10 year which is up +5 bps at 4.21%. The UST 10 year is now at 3.80% and down -3 bps from where we opened this morning.

EQUITIES LACKLUSTER LOCALLY, DOWN SHARPLY IN CHINA
The NZX50 has started the week up +0.2%. This is after having come off a week where the NZX50 capitalization rose +1.3% which was unusually good when benchmarked against the usual suspects. It was helped by a +2.6% rise in Energy sector stocks, but hurt by a -3.3% retreat in the Retirement/Rest Home sector. Separately, F&P Healthcare (FPH, #1) rose +2.8% which also helped. Today, the ASX200 is flat (and slipping away) in afternoon trade. Tokyo has opened down a minor -0.1%. But Hong Kong is continuing its wild rise, down -2.3% at its opening. Shanghai has opened down -0.9%. If the S&P500 futures are any indication, Wall Street won’t open with any gains either.

GOLD SOFT
In early Asian trade, gold is at US$1745/oz and down -US$6 from where we opened this morning.

NZD LITTLE-CHANGED
The Kiwi dollar is marginally softer than this morning’s open, now at 61.4 USc. Against the AUD we are still at 92.2 AUc. Against the euro we are still at 59.6 euro cents. That all means our TWI-5 is now at 70.6 and unchanged from this morning.

BITCOIN SLIPS
Bitcoin is now at US$16,210 and down -2.1% from where we opened this morning. Volatility over the past 24 hours has remained modest at just over +/- 1.8%. Trading volumes are lower than this time last week.

Select chart tabs


Select chart tabs


This soil moisture chart is animated here.

Keep abreast of upcoming events by following us Economic Calendar here ».

Leave a Comment