A review of things you need to know before you go home Friday; HCNZ raises rates, butter prices up, record migration, tourism booms, a bank's honeypot, a $4 bln commitment; swaps fall, NZD rises

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

MORTGAGE RATE CHANGES
Housing NZ Corporation has increased its two and five year fixed rates by +10 bps.

DEPOSIT RATE CHANGES
No changes here either. But RaboDirect has a refreshed website, which some readers might like to check out.

BETTER THAN AT AUCTION
The Global Dairy Trade auction might have been pretty tame earlier this week, but today’s USDA report for Oceania prices was more positive – especially for butter which is at record highs. Take a look at our chart to get the scale of these impressive rises, gains that don’t seem to be inhibited by our exchange rate.

RECORD MIGRATION
Our population gains from permanent migration hit a fresh record of 72,305 in the June year. Record arrivals of non-New Zealand citizens has pushed up population growth from migration to yet another all time high, strongly driven by those with work visas.

BOOMING TOURISM
Infometrics reports that tourist arrivals were up +17% in June, the second largest rise in 13 years. This surge was largely due to the Lions tour, which we estimate saw an influx of 16,000 additional British and Irish visitors. However, after we exclude those from Britain and Ireland, visitor arrivals rose by +9.8%, which is still considerable growth in an already booming industry.

HONEYPOT DEBT
Data out today for June from the RBNZ shows that we spent +6.7% more on our credit cards in the month than for the same month a year ago. (Visitors, including overseas rugby fans, spent another +8.8%.) But our balances grew ‘only’ +4.6% in the same time. 36.7% of all credit card balances don’t incur interest. (We are still waiting to report a drop in the sky-high credit card interest rates. It’s been years …. ) Banks charge about $725 mln in interest on these cards; you can see why it is a honeypot.

GOING UP-MARKET
Fonterra is investing $150 mln in a new Darfield, Canterbury plant to produce cream cheese for Asian markets. This facility will be paired with its existing Te Rapa, Waikato cream cheese operation. This is part of how Fonterra is getting +20% year-on-year growth in its foodservice products from New Zealand sources.

RIP HUGH BURRETT
Former ASB CEO Hugh Burrett has passed away. The bank, and former ASB and CBA CEO Ralph Norris, have today been lauding his 40 years with the bank, seven as CEO between 2001 and 2008, a period when ASB grew very strongly.

A $4 BLN ELECTION PROMISE
The Labour Party has released its Education Manifesto which it says “will bring positive change across the education sector and is backed by a massive investment”. They plan to back the policy with an extra $4 bln. “These priorities will drive change across the sector, raising the quality of education for our smallest toddlers showing up for their first day of ECE to our oldest learners attending soon-to-be restored night classes,” they say.

TAX DODGING
A new Report says Australians are using trust funds to minimise their taxable income to the tune of AU$3.5 bln per year. It found those who contribute the most to the country’s AU$3.1 tln trust pool make more than AU$500,000 a year.

SLIPPING BEHIND
And staying in Australia, the latest quarterly update from the banks’ independent governance expert shows many key initiatives dealing with sales commissions, rogue advisers, reporting of breaches and dispute resolution are still a fair way from being implemented.

WHOLESALE RATES FALL & FLATTEN
Wholesale swap rates have fallen -2 bps for the two year term, by -3 bps for the five year term, and by -4 bps for ten years. The 90 day bank bill rate is unchanged at 1.94%.

NZ DOLLAR RISES
The Kiwi dollar is up strongly today at 74.2 USc. On the cross rates we are up strongly against the Aussie as well to 93.9 AUc and stable at 63.8 euro cents. That puts the TWI-5 up to 77.2. Bitcoin has leaped by over US$400 today to US$2,740, up +17.7% from this time yesterday.

You can now see an animation of this chart. Click on it, or click here.

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