Here are the key things you need to know before leaving get off work today (or before shutting down your laptop if you’re already working from home).
Mortgage Rate Changes
Westpac raised its fixed rate today. See details here. The same is true for China Construction Bank.
Changes in Fixed Deposit Interest Rates
Westpac has also raised TD rates.
Not as good as expected
Fonterra report In today’s annual report, after-tax income fell -3% to $583 million. It retained its 2022/23 milk price forecast range of $8.50 to $10.00, with a median price of $9.25. It also found it could not be sold outside Australia at an acceptable price, so it said it would retain full ownership of its Australian operations. It said it would pay a final dividend of 15c, making the annual dividend payout 20c per share. Most recently, its shares had risen from $2.94 to $3.47 (+17%) ahead of these results.release release FSF Shares fell to $3.35, or -3.4%.Details of milk payment history are here.
“off the canvas, but still dazed“
Wespac MM Consumer Confidence Survey report Good recovery in September, but only from Record low in JuneBut they said the atmosphere in the country could hardly be described as grim. High consumer prices and rising borrowing costs are squeezing household finances. Against this backdrop, willingness to spend remains subdued, they said.
sailing blindly to the rocks
our Commodity Trading Results The monthly deficit in August was a record high of -$2.4 billion. In the year to August, the deficit was -$12.3 billion, also a record. This is driving our current account deficit to a dive. As others have pointed out, this is funded by foreigners, and their funding will continue – until they lose faith. Then something really bad could happen. Sadly, there seems to be little public policy attention to this widening deficit, which is itself a corrosive deficit.
who is eating our lunch
Over the past 12 months, our trade surplus with China has fallen from +$4.3 billion to just over $1 billion. For Australia, we have gone from surplus to deficit by -$1.2 billion. The US is a -$200 million retreat, and Japan is a -400 million dollar retreat.The four have transferred -$5.2 billion over the past year, well over half Overall – $9.4 billion deterioration.
AVANTI FINANCE appoints product and market HONCHO
Avanti Finance has hired Elaine Owens as head of product and markets to support the lender’s “significant growth and develop new products to meet the needs of introducers and consumers in Australia and New Zealand”. Owens joined the Medical Security Association (MAS) as Chief Product Officer and previously worked at ANZ.
Liquidators interested in VIVIER’s WESTPAC account
Liquidators for Vivier and Company, Waterstone Insolvency, were seeking details from Westpac NZ and found the company had a Westpac bank account in 2014-15. Liquidators, which recently succeeded in putting sister company Vivier Capital into liquidation, said it may apply to the court to treat the two liquidations as one entity. Waterstone Insolvency also said in their second liquidators report that BNZ and ASB, which worked with Vivier, became suspicious and closed accounts. Here’s some background on Vivier.
The deposit guarantee is around here
The Deposit Taker Bill, which provides deposit guarantees for depositors of up to $100,000, was introduced to Parliament today. more here. The source of funding for the guarantee is a risk tax levied on banks, and deposit takers pay different interest rates based on an assessment of the risk they pose. This may protect already powerful (or government-owned) institutions and penalize smaller institutions and new entrants.
go to the well
Yesterday, another $185 million was drawn from the Loan Facility Program. D12 The Reserve Bank of New Zealand disclosed. We don’t know who made this/these withdrawals, but it’s unlikely it was any of the four Australian banks that made the bid. With $14,745 billion now borrowed under FLP, the cost of these funds is now 3.0% and could rise to 3.50% on October 8. This is no longer “cheap money”. The FLP option will close in December and then run out over the next three years.
A total of 109 bids Three NZGB bond tenders today Those bidders offered $400 million for $934 million. The winning bid of $200 million in May 2026 (4 years) is 4.04%, up from 3.87% two weeks ago. The bank only offers a four-year term of 4.40%, which makes the risk-free NZGB option very attractive. A $150 million offer for the April 2029 bond attracted bids of $450 million, with the winning bidder yielding 4.00%, up from 3.90% two weeks ago. The $50 million bid in May 2051 is $139 million and yields an annual yield of 4.37%.
Swap rates remain high
Wholesale Swap Rate It may be firmer and flatter in global power today, albeit not by much. our chart The final position will be recorded. The 90-day bank bill rate rose another 3 basis points to 3.74%, the highest since January 2015, following a sharp rise yesterday. The Australian 10-year bond yield is currently at 3.74%, up +1 basis point from this time yesterday. China’s 10-year bond rate also rose +1 basis point to 2.69%. The New Zealand government 10-year bond rate is currently at 4.05%, down -1 basis point from this time yesterday, but still above the RBNZ’s previous fixed rate on the bond, which was -2 basis points down. UST 10Y is currently at 3.56%, up +1 basis point from this time yesterday. At some point in between, it rose to 3.61%.
Stocks sell off after the Fed
Wall Street is struggling to figure out what the Fed’s stance means for stock investors. It was up +0.8% just before the Fed statement. It then fell -1.6% from there. It then rose +1.9% from there. Then it darkened, closing down -1.7%. It is down -4.2% so far this month. It’s down -21% from its late 2022 peak so far, so it’s now a clear bear market. Tokyo is down -1.3% so far today. Hong Kong was down -1.7%, but Shanghai was up +0.2% in early trade. The ASX200 is closed today for a public holiday. The NZX50 also rose 0.2%, led by Air New Zealand (Air#36) Up +2.1%, Fisher & Paykel Financial (FPH#1) Up +1.7%, Spark (SPK, #2) rose +1.2% today. The towline is the freight road (degrees of freedom#19) down -4.2%, vector (VCT#25) down -2.1%.
Gold can’t keep rising
In early Asian trade, gold was down $6 from this time yesterday to $1,659 an ounce. This comes after closing at $1,671/oz in New York and $1,674/oz in London, making it difficult for gold to sustain any gains that occurred after the Fed’s decision.
New Zealand dollar continues to slide
The NZD has lost another -¾c from this time yesterday and is now at 58.2 USc. Aside from the pandemic dive, it was a 13-year low. It was little changed against the Australian dollar at 88.3 AUc. Against the euro we were also little changed at 59.3 cents. This all means that our TWI-5 is 68.4, down another -30 basis points from this time yesterday. This is the lowest level since October 2020.
Bitcoin is down today and is currently trading at $18,463, down -3.0% from this time yesterday. Volatility over the past 24 hours is very high at +/- 4.5%. For almost four consecutive days now, Bitcoin price has not been able to get back to $20,000 at any point.
Select the chart tab
Select the chart tab
This soil moisture map is animation is here.
Follow our events to stay up to date with upcoming events Economic Calendar is here ».