Here are the key things you need to know before you leave work today.
TODAY’S MORTGAGE RATE CHANGES
No changes announced today, but my guess is that at the close of business tomorrow one and possibly two main banks may announce ‘specials’ that match BNZ and Westpac. Only a guess though.
TODAY’S DEPOSIT RATE CHANGES
Nelson Building Society today cut rates for 1 and 2 year terms by -5 and -10 bps. But they raised their 9 month rate by +40 bps to an impressive 4.50%.
NOT EVEN CLOSE
New residential building consents were down overall last month, but were up tamely in Auckland and flat in Christchurch. It was yet another month of under-performance in Auckland. (But at least our data is better than the same data out in Australia today which is on a four month slide. Adelaide is really struggling.)
But the under-performance of the housing sector is in stark contrast to the commercial sector, especially outside of Auckland and Canterbury. The value of consents in June was up an impressive +40% from a year earlier. Some of the biggest growth came from Hamilton and Tauranga, with both cities seeing a jump across a wide range of building types. Activity in Auckland was -18% lower than a year ago, the third year-on-year decline in the last four months.
A GREAT TRACK RECORD
In the six risk categories we analyse over all 82 KiwiSaver funds, ANZ Investment funds are the clear top performer to June 2015 since inception. We identify the funds with the best long term track records and in the top three positions for each category (that’s 18 positions), ANZ Investments funds hold nine of them. Even more impressive is that they are a bank. The only other bank making any top-3 position is ASB in the Default funds (although Kiwibank-owned Kiwi Wealth scoops the Conservative category).
RBNZ data out today shows that they did not intervene by trading in currency markets in June.
Here’s something we don’t often report. New Zealand’s official overseas reserves are now at NZ$26.5 bln (including other FCY assets), the highest they have been since May 2012 when they reached $28.3 bln. Given that our GDP (nominal) was NZ$239 bln in the year to March, our reserves are now more than 10% of GDP.
TURNERS BUYS SOUTHERN FINANCE
Turners, formerly Dorchester Pacific, has struck an unconditional $5 million deal to buy the Christchurch based Southern Finance, which is a used vehicle financier. Turners says Southern Finance has about $3.3 million of net assets, and goodwill of $1.7 million. The deal’s due to settle on Friday, July 31, and be paid FOR with bank borrowings. Turners says Southern Finance should immediately contribute about $750,000 in annual earnings before interest and tax, rising to $1 million after the first year.
WHOLESALE RATES STEEPEN
The steepening trend in wholesale rates really took hold today. Two year swaps are up another +2 bps, five years are up another +4 bps, and ten years are up an impressive +6 bps today. The 90 day bank bill rate is unchanged at 3.08%.
NZ DOLLAR SOFTER
Markets liked what the US Fed announced this morning and the US dollar has risen and this sees the NZ dollar softer and currently at 66.3 USc, also lower against the Aussie at 90.8 AUc, and at 60.5 euro cents. The TWI is at 71.3. Check our real-time charts here.
You can now see an animation of this chart. Click on it, or click here.