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

MORTGAGE RATE CHANGES
ASB and TSB cut floating rates by -15 bps. SBS cut by -20 bps. ICBC cut theirs by -41 bps to 6.09%. ICBC also cut its fixed rates. All rates are here.

TERM DEPOSIT/SAVINGS RATE CHANGES
There were rate reductions announced today from TSB, ICBC, Xceda and Liberty Financial. All updated term deposit rates less than 1 year are here, for 1-5 years, they are here.

SHRINKING
Fonterra is retreating from its consumer businesses by selling them to Lactalis for $3.8 bln, possibly more. The to French giant Lactalis will deliver a $3.2 bln tax-free boost for shareholders. It retains supply agreements for iconic dairy brands Anchor and Mainland

RAISING FINANCIAL SYSTEM RISKS
A parliamentary committee has asked the RBNZ to halt capital increases for banks ‘immediately’. The Finance and Expenditure Committee members, pushed by the farmimg lobby, want the Reserve Bank to scrap all further increases in bank capital requirements and establish an independent committee to make prudential policy more market (farmer) friendly. If they get their way it will be a win for the banks to run more highly-leveraged operations, juicing their ROE, and setting back efforts to constrain those financial stability risks, which are very real. Taxpayers will have to underwrite this folly.

NET INTEREST EARNED BY BANKS TOPS $16 BLN FOR YEAR TO JUNE, A RECORD
Ahead of the revealing RBNZ Dashboard release on Monday, August 25, 2025, today the RBNZ released its S20/S21 series where we get to see the banking systems net interest income, and its net interest margin (the NIM). The NIM remains remarkably stable and clearly banks are managing to this metric. It has been at this current level since the end of 1999, settling there after a long run of being much higher. Net interest earned however continues to rise and in June was a new record at $4.047 bln in the quarter, and for the first time exceeding $16 bln for the year. How things shifted for individual banks (the winners & losers) will become clearer when the Dashboard is released.

A NEW FRAUD VECTOR ARRIVES
‘Ghost tapping’ contactless payments fraud is happening in here, with the police apprehending a Chinese tourist trying to buy luxury goods.

TRYING TO STAY UP WITH THE THREAT
The Serious Fraud Office (SFO) is seeking public feedback on its draft Long-term Insights Briefing (LTIB): Staying ahead of the curve: Responding to emerging trends in detecting fraud and corruption in New Zealand.

BRAZEN BUT CONVINCING
Scammers who have been using social media advertisements, particularly on Meta platforms, to impersonate New Zealand celebrities, journalists, politicians, have now turned to impersonating financial commentators and business leaders by creating fake profiles. Within the past week emails have gone out claiming to be from us wanting you click a link to get “invoice”. The use of AI tools to make this sound credible is a negative development.

NZX50 ENDS WEEK WEAK
As at 3pm, the overall NZX50 index is down -0.7% so far today, ending the momentum after the OCR cut. It is now up +1.6% over the past five days and up +0.2% year-to-date. It is now sitting +5.0% higher year-on-year. Market heavyweight F&P Healthcare is down -1.6% today so far. Sky TV jumps +6% but SkyCity casino plunges -22%; a2 Milk, Heartland and Oceania Rise, while EBOS, Kathmandu and Vista decline.

PROFILE UPDATES
We have updated the profiles after the annual results for the following NZX50 companies: Skellerup, SkyCity casino, Heartland, Auckland Airport, and SkyTV. You can find them all here.

AI JUICES BUSINESS ‘INVESTMENT’
New data out from the Australian statistics bureau shows their R&D investment grew by +18% to AU$24 bln in 2023-24. The strongest growth IT including spending on Artificial Intelligence, which grew by +142% since 2021-2022. 

BROAD RANGE OF FORCES
There was a surprising dip in Japanese inflation in July. It eased to 3.1% from 3.3% in the previous month, the lowest reading since November 2024. Helping was that electricity prices fell for the first time since April 2024. But food prices jumped +7.6%, the most since February. Again, rice was the big culprit.

SWAP RATES SOFT AGAIN
Wholesale swap rates are will probably be little-changed today at the short end, steepening for longer maturities. Keep an eye on our chart below which will record the final positions closer to 5pm. The 90 day bank bill rate was down -12 bps at 3.02% on Thursday reflecting the OCR cut and dovish view. The Australian 10 year bond yield is up +5 bps at 4.32%. The China 10 year bond rate is back down -3 bps at 1.77%. The NZ Government 10 year bond rate is up +2 bps at 4.41% and up +5 bps at 4.40% in the earlier RBNZ fix* today. The UST 10yr yield is up +4 bps from yesterday, now at 4.33%. (* The RBNZ has bent to NZFMA/Bloomberg/etc pressure and will soon revert to end-of-prior-day reporting of benchmark rates, shifting back from the current 11am disclosures.)

EQUITIES MIXED
The local equity market is now down -0.8% in late Friday trade. The ASX200 is down -0.2% in afternoon trade. Tokyo has opened little-changed. Hong Kong is up +0.5% at its open and Shanghai is up +0.6%. Singapore has opened up +0.3%. Wall Street ended its Thursday session with the S&P500 down -0.4%.

OIL FIRMISH
The oil price in the US is up +50 USc today, now just on US$63.50/bbl and the international Brent price is now just on US$67.50/bbl.

CARBON PRICE HARD TO KNOW WITH SO FEW TRADES
There have been few trades again today, in another dry patch, with the price holding down at $56. The next official carbon auction is on September 10, 2025. See our daily chart tracker of the NZU price for carbon, courtesy of emsTradepoint.

GOLD SOFTISH
In early Asian trade, gold is down -US$11 from this time yesterday at US$3333/oz.

NZD STABILE
The Kiwi dollar is unchanged from yesterday at this time, still down at 58.2 USc. Against the Aussie we are down -20 bps at 90.5 AUc. Against the euro we are up +10 bps at just on 50.1 euro cents. This all means the TWI-5 is holding at at 66.6.

BITCOIN HOLDS
The bitcoin price is now at US$113,244 and down -0.7% from this time yesterday. Volatility has been modest at just ovder +/-1%. The retreat from crypto investing by institutional investors in ETFs is large and causing the jitters,

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