free lunch
Recent releases
Economic
Exports / imports 30/08/2010
Jul 10 | annual balance: $573m
Tourism 20/08/2010
Jul 10 | arrivals a.p.c: 3.8%
Producer prices 19/08/2010
Jun qtr 10 | inputs a.p.c: 2.0%
Retail sales 13/08/2010
Jun qtr 10 | excl. auto a.p.c: 1.7%
Employment 5/08/2010
Jun qtr 10 | unemployment rate: 6.8%
Labour market 3/08/2010
Jun qtr 10 | Unadjusted LCI a.p.c: 2.9%
Borrowing / lending 29/07/2010
Jun qtr 10 | housing debt a.p.c: 2.8%
Monetary policy 29/07/2010
Jul 10 | OCR: 3.00% (prev. 2.75%)
CPI - inflation 16/07/2010
Jun qtr 10 | a.p.c: 1.8%
GDP 24/06/2010
Mar qtr 10 | production a.a.p.c: -0.4%
Balance of payments 23/06/2010
Mar qtr 10 | deficit as % of GDP: 2.4%
Terms of trade 10/06/2010
Mar qtr 10 | a.p.c: -0.2%
Manufacturing 8/06/2010
Mar qtr 10 | real output q.p.c: -0.8%
Fiscal update 20/05/2010
May 10 | OBEGAL ye forecast: -$8.63bn
Government accounts 7/05/2010
Mar 10 | OBEGAL ytd: -$5.27bn
Jul 10 | annual balance: $573m
Tourism 20/08/2010
Jul 10 | arrivals a.p.c: 3.8%
Producer prices 19/08/2010
Jun qtr 10 | inputs a.p.c: 2.0%
Retail sales 13/08/2010
Jun qtr 10 | excl. auto a.p.c: 1.7%
Employment 5/08/2010
Jun qtr 10 | unemployment rate: 6.8%
Labour market 3/08/2010
Jun qtr 10 | Unadjusted LCI a.p.c: 2.9%
Borrowing / lending 29/07/2010
Jun qtr 10 | housing debt a.p.c: 2.8%
Monetary policy 29/07/2010
Jul 10 | OCR: 3.00% (prev. 2.75%)
CPI - inflation 16/07/2010
Jun qtr 10 | a.p.c: 1.8%
GDP 24/06/2010
Mar qtr 10 | production a.a.p.c: -0.4%
Balance of payments 23/06/2010
Mar qtr 10 | deficit as % of GDP: 2.4%
Terms of trade 10/06/2010
Mar qtr 10 | a.p.c: -0.2%
Manufacturing 8/06/2010
Mar qtr 10 | real output q.p.c: -0.8%
Fiscal update 20/05/2010
May 10 | OBEGAL ye forecast: -$8.63bn
Government accounts 7/05/2010
Mar 10 | OBEGAL ytd: -$5.27bn
BuildingNon-residential building 31/08/2010
Jul 10 | value a.p.c: -21.0%
New dwellings 31/08/2010
Jul 10 | excl. apart a.p.c: 27.1%
Migration 20/08/2010
Jul 10 | annual (net): 15,221
Building / vehicle costs 19/08/2010
Jun qtr 10 | residential a.p.c: 0.2%
House sales 13/08/2010
Jul 10 | a.p.c: -26.7%
House prices 9/08/2010
Jul 10 | a.p.c: 4.1%
Residential rents 14/07/2010
Jun qtr 10 | a.p.c. 3.1%
Work put in place 8/06/2010
Mar qtr 10 | total real q.p.c: 0.7%
Jul 10 | value a.p.c: -21.0%
New dwellings 31/08/2010
Jul 10 | excl. apart a.p.c: 27.1%
Migration 20/08/2010
Jul 10 | annual (net): 15,221
Building / vehicle costs 19/08/2010
Jun qtr 10 | residential a.p.c: 0.2%
House sales 13/08/2010
Jul 10 | a.p.c: -26.7%
House prices 9/08/2010
Jul 10 | a.p.c: 4.1%
Residential rents 14/07/2010
Jun qtr 10 | a.p.c. 3.1%
Work put in place 8/06/2010
Mar qtr 10 | total real q.p.c: 0.7%
TransportTransport update, August 2010
(23/08/2010)
Transport update, July 2010
(22/07/2010)
Transport update, June 2010
(24/06/2010)
Transport update, May 2010
(25/05/2010)
Transport update, April 2010
(23/04/2010)
Transport update, February 2010
(23/03/2010)
(23/08/2010)
Transport update, July 2010
(22/07/2010)
Transport update, June 2010
(24/06/2010)
Transport update, May 2010
(25/05/2010)
Transport update, April 2010
(23/04/2010)
Transport update, February 2010
(23/03/2010)
RetailRetail Report, August 2010
(31/08/2010)
Retail Report, July 2010
(30/07/2010)
Retail Report, June 2010
(1/07/2010)
Retail Report, May 2010
(1/06/2010)
Retail Report, April 2010
(30/04/2010)
Retail Report, March 2010
(1/04/2010)
(31/08/2010)
Retail Report, July 2010
(30/07/2010)
Retail Report, June 2010
(1/07/2010)
Retail Report, May 2010
(1/06/2010)
Retail Report, April 2010
(30/04/2010)
Retail Report, March 2010
(1/04/2010)
No let-up for non-residential 31/08/2010Jul 10 | value a.p.c: -21.0%
The non-residential building consent data remained weak in July, despite the value of work edging up for the second month in a row (5.9%, seasonally adjusted). That small lift is about as far as the good news extends – trying to cut the numbers any other way reveals only weakness.
Sentiment turns against housing 31/08/2010Jul 10 | excl. apart a.p.c: 27.1%
Non-apartment consents slipped 5.3% in July, and are now down 15% from their April 2010 level (seasonally adjusted). Tax changes and the recent slide in house prices have taken the wind out of the building industry’s sails. However, although activity may remain stagnant in the near term, consents are still well below underlying demand and will pick up again from late 2010.
Commentary
Articles
Measuring the influence of industry misallocation
(20/08/2010)
Saving compulsion is crass policy
(20/08/2010)
Cutting the dead wood
(13/08/2010)
Counting the cost of misdirected investment
(6/08/2010)
When Have We Done Enough?
(30/07/2010)
(20/08/2010)
Saving compulsion is crass policy
(20/08/2010)
Cutting the dead wood
(13/08/2010)
Counting the cost of misdirected investment
(6/08/2010)
When Have We Done Enough?
(30/07/2010)
Financial
Turning the risks upside down
(27/08/2010)
The first dip is the deepest
(20/08/2010)
Some good news please
(13/08/2010)
When in doubt, do nothing?
(6/08/2010)
(27/08/2010)
The first dip is the deepest
(20/08/2010)
Some good news please
(13/08/2010)
When in doubt, do nothing?
(6/08/2010)
International
Oww Bollard, Bollard, it's a wild world 3/09/2010A whole suite of positive, negative, and genuinely mixed results came out this week - making the entire economic outlook that much more uncertain. With uncertainty regarding the outlook for the New Zealand and international economies elevated, we expect the Reserve Bank to wait until the dust settles before increasing the official cash rate again. In other words, we now do not expect the Bank to lift the OCR in September.
Financial weekly: PDF | Calendar | Strategy | Graphs
The daily grind3/09/2010At the turn of the century, telecommuting was a big buzz word in IT and management circles. Many white-collar workers wondered if the days of commuting into the office five days a week were numbered. But while communication and remote access technology has matured considerably over the last decade, most of us seem unwilling or unable to make the switch and start predominately working from home.
Getting smarter about debt27/08/2010Compulsory saving has been raised as a solution to New Zealand’s perceived saving problem. Last week my colleague discussed how compulsory saving is a blunt tool for solving any perceived failure in credit markets. This is an important point, one that I wish to expand upon this week.
July 10 forecasts
Economic
Building
Transport
Retail
The beautiful game | Economic OutlookPDFThe All Whites’ run at the FIFA World Cup may be over, but the New Zealand economy’s run of strong export prices is set to continue for some time yet. Sustained demand from China has been a central theme of our forecasts in recent times, and remains a key factor in ensuring this country’s economic success over the next five years.
Forecast StoryAs the dust settles from the global
financial crisis of 2008/09, the road to recovery for the New Zealand and global economies has been rocky. Problems are persisting in Europe, but we expect these to have minimal effect on economic growth in the Asia-Pacific
region in the near-term. China will continue to be a dominant force in global
growth, underpinning strong commodity prices for our exports and boosting New Zealand incomes on an economy-wide basis. New Zealand’s GDP growth is forecast to
average 3.2%pa over the next five years, but with consumption and investment
spending recovering, there will be a renewed deterioration in the current
account deficit and savings rate. Against the backdrop of a strong economy,
the National-led government is poised to be re-elected next year, and will
maintain a relatively centrist approach to setting policy during its second
term.
Household ForecastsThe behaviour of households, both in terms
of spending and borrowing, has come increasingly under the spotlight in recent
years. Tight credit conditions, a weak labour market, falling house and equity
prices, and substantial increases in the cost of food and petrol are all
factors that have pushed households away from the loose-spending days of early
2007. In the near term, these difficulties will see households remain cautious
about spending – but in the medium term, improving economic conditions will
ensure that consumers get back into the habit of consuming.
Business Issues ForecastsTrading conditions have been rocky for most
firms over the past two years as domestic and global demand for goods and
services collapsed in the face of a complete seizure of financial markets.
However, the worst is now definitely behind us. Although the economic recovery
has been patchy so far, conditions for business are expected to improve
markedly over the next year – with credit conditions loosening and
profitability returning. Improving business conditions and a tightening labour
market will see business investment climb over the forecast period.
Financial Markets ForecastsThe Reserve Bank has started on what
promises to be a long phase of tightening monetary policy, with the official
cash rate set to climb towards 6.5% by 2012. The inflation picture will be
muddied over the next 12-18 months by government policy changes, but in the
near-term, we expect inflationary pressures to remain relatively well contained
thanks to the spare capacity in the New Zealand economy. The medium-term
inflation outlook is less settled, as domestic inflationary pressures re-emerge
and the Bank’s relatively lax approach to setting monetary policy sees
inflation above 3%pa throughout the second half of the forecast period. The
persistently high terms of trade will keep the New Zealand dollar at levels
above historical averages throughout the next five years.
Fiscal ForecastsApart from a smaller-than-expected fall in
the top tax rate, the measures announced in the 2010 budget were in line with
our March fiscal forecasts. National has taken a step towards a more efficient
tax system, but with progress also came missed opportunities. Little change
was made to the excessive effective marginal tax rates faced by many
middle-income families. Interaction between the tax and welfare system means
some households face effective tax rates of over 50% on extra income, not the
17.5% Bill English claims that 73% of taxpayers will now face. The effect of
such high marginal tax rates on economic efficiency needs to be properly
addressed. The outlook for the operating deficit has improved over the last
year, and we now expect a small budget surplus to emerge in 2014.
External ForecastsThe external account is looking in good
shape as the domestic economy moves into recovery mode. During the rest of
2010 and into 2011, we expect the terms of trade to improve further, boosting
incomes and domestic demand. But even with high prices for exports, the trade
balance will begin to deteriorate as the pick-up in imports gathers momentum
during the second half of 2010. Stronger imports and a rise in dividends to
overseas investors will see the current account deficit expand rapidly over
coming years.
International forecastsAttention has turned from the embattled
private lending sector in Europe and America to the governments that underwrote
its losses. So far, the recent sovereign debt crisis has had a limited and
short-lived effect on commodity prices, and we are hopeful that any major
fall-out from the crisis will be confined to Europe. GDP growth in the US is beginning to pick up, but there remains a lot of spare capacity in the American
economy. China continues to be the stand-out performer, and demand from China is having flow-on effects throughout Asia and Australasia. Even as China’s fiscal stimulus is
pegged back over the next year, we are confident that the Chinese economy can
sustain growth of between 7% and 10%pa during our forecast horizon.
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