What happened on Thursday | interest.co.nz
Here are the key things you need to know before you leave work today (or if you’re already working from home, before shutting down your laptop).
MORTGAGE RATE CHANGES
Nothing to report today.
CHANGES IN TERM DEPOSIT RATES
Nothing to report here either.
BIG BOND CALLS, UNUSUAL RESULTS
123 offers were received through three very interesting NZBG bond tenders today where $400 was offered. Bidders bid $1.2 billion in total, by far the largest of the year. The May 2026 offering of $200 million attracted nearly $500 million in bids. 16 offers were accepted and an average yield of 3.39%. This May 2026 offer is unusual, it was last offered in early December 2021 when the average yield was 2.33%. Even more unusual is the $150 million offered for their April 2029 bond, last offered nearly a year ago. This time $571 million was bid by 32 bidders, but only one succeeded, bidding 3.51% to win. On July 29, 2021, this bond achieved a yield of just 1.37%. There was a third tender for a May 2051 bond with only $50 million offered. $131 million was donated by 52 parties. But only two managed, gaining 3.98%, which was actually lower than the 4.15% reached a week ago.
6.95% FROM A MAJOR BANK
The ANZ Preferred Share Offering raised $660 million. That’s way more than the $250 million they were looking for. One reason may be because they will pay a preference. dividend in shares at the rate of 6.95% per year for the next six years. Then this rate resets. The story of the pref. share resets are very mixed though. Preferred shares rank ahead of common stocks (which earn the declared dividend), but behind all debt, including unsecured creditors like depositors.
A former staff member of the Office of the Parliamentary Counsel has been charged with fraud. The alleged fraud, obtaining funds by deception, relates to a bill of $55,200 in 2019.
CARBON EXPORTS ARE PAYING OFF FOR AUSTRALIA
There was a big surprise in Australian trade data reported today for the month of May for goods and services. Most analysts were expecting a surplus of +A$10.7 billion, but in the end, a surplus of +A$16 billion was recorded and a new all-time monthly high. This brings their annual surplus to A$135 billion and also a stunning record and +60% more than for the year of May 2021. In addition, the April surplus has been revised upwards to +13, 2 billion Australian dollars. Very juicy figures for them, driven by exports, up nearly +10% while an increase of +1% was expected. Coal shipments were particularly strong – to China.
Americans are relaxation of import rules to allow foreign infant formula makers to stay in their market for the long term, in a bid to diversify the industry after the closure of their biggest domestic plant triggered a nationwide shortage.
SWAP RATES REBOUND
Wholesale swap rates stopped falling and rallied today, following trends in the international bond market. But the moves are minor and nothing to do with international jumps. The 90-day bank bill rate remained unchanged at 2.85% today. The Australian 10-year bond yield is now at 3.43% and down -2 basis points from the same time yesterday. The Chinese 10-year bond rate is now at 2.86% and up +1 bp. And the New Zealand 10-year government bond rate is now at 3.64%, up +4 basis points from the same time yesterday and now below the RBNZ’s earlier patch for that bond which was back up +9 basis points to 3.69%. The 10-year UST is now at 2.90% and up +7 basis points from the same time yesterday.
MIXED STOCK PRICES
At the end of the session on Wall Street, the S&P500 ended up +0.4% during its session on Wednesday. The NZX50 is marginally down -0.1% in late trading after a string of strong days. The ASX200 is up +0.4% after a string of weak days. Tokyo opened up +0.8%. Hong Kong is down -0.5%, but Shanghai opened today up +0.2%.
In early Asian trading, gold is down -US$30 from the same time yesterday at US$1,740/oz. Earlier it closed in New York at US$1739 an ounce and earlier still in London at US$1754 an ounce.
The Kiwi Dollar was little changed from this time yesterday at 61.8 USc. Against the AUD, we are holding a low at 90.7 AUc. Against the euro, we rose by +50 basis points to 60.6 euro cents. That means our TWI-5 is now firmer at just over 70.5.
Bitcoin is now at US$20,504 and up +3.4% from this time yesterday. Volatility over the past 24 hours has been moderate at +/- 2.2%.
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