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Recent releases

All hands on deck for non-residential building September completed a massive quarter for non-residential building, with the value of consents in the quarter up 28% from a year earlier, despite a 2.6% seasonally adjusted drop in activity from August. Unlike the previous two months, activity in September was boosted by a single large consent, worth $99m, as part of the University of Auckland’s development of its Newmarket campus. But even without this project, the value of consents last month would still have been up 11% from September 2013. Read more

Consent growth slows as Canterbury comes off the boil The number of non-dwelling consents grew at an annual pace of 1.0% in September — the slowest rate in three years. In seasonally adjusted terms this result is even weaker, with non-apartment consent numbers dropping by 10% over the month. However, the total residential consent figure for the September quarter remains strong, with elevated apartment consents boosting the count over the period. Read more

Commentary

Can the US carry the world? With commodity prices slumping, the Eurozone on the ropes, China rebalancing, Japan engaged in more self-inflicted sales tax pain, and emerging markets stuttering, the outlook for the global economy has taken a backwards step since the middle of the year. However, despite all of this the US economy grew by 0.9% (seasonally adjusted) in the September quarter. Given that the Reserve Bank of New Zealand (RBNZ) identified the US as an important exception to the trend of softening growth among the major world economies, we need to ask whether this growth was a flash in the pan, or whether a resurgent US economy is going to drag up the rest of the world along with it.
October 2014 monthly At 1.0%pa, inflation in September was substantially weaker than market expectations. While the spectacularly high New Zealand dollar kept tradable inflation under wraps, non-tradable inflation showed surprising frailty, especially given September is usually a stronger quarter price growth. Although capacity is tightening in some areas of the economy, there appears to be more slack in the economy than thought. With these factors in mind, we expect the Reserve Bank to maintain the current 3.50% official cash rate until at least June next year. Read more.

Industry effects of minimum wage increases In 2012, the Living Wage Aotearoa NewZealand movement[1] commissioned a report on a livingwage.  As this movement gathered momentum, there has been a social push forminimum wages hikes – something a number of government parties brought intotheir pre-election policies.  This article will look into the industries mostaffected by minimum wage increases and analyse likely business responses overthe short and medium term. Read more.

Latest Forecasts

Best before: February 2014

If you’ve gone to the fridge and taken a swig of milk from the bottle lately, you will have noticed it’s got lumps in it – which is hardly surprising when you look at the “best before” date. Prospects for the dairy payout and GDP growth looked pretty tasty back in February, but things have soured markedly throughout the course of this year.