Motorists have been incensed this week, with the price of 91 octane petrol heading over $2.30/l in some parts of the country. Increased fuel prices aren’t yet at the highest (real) levels we’ve ever seen – but they’re close. Based on the unrest in the Middle East, fuel prices might remain elevated for some time. This will hurt more than just the classic Sunday drive, with airfares, freight costs, and eventually goods prices also needing to increase to cover higher fuel bills.
Today’s Budget gives us a clearer picture of the government’s intentions for housing over the next four years. More practical KiwiBuild targets have been mixed in with increased spending for health and education building, alongside a state housing boost. However, details are scant, and increasing funding without detailing exactly where it will be spent signals to us that actual activity will be pushed back further.
Election 2017 saw some high-profile and costly spending promises by all three parties now in government, and expectations are high for more cash in the upcoming budget. Finance Minister Grant Robertson will lay out his spending plan on May 17, with a mixture of red, black, and green anticipated.
Transport funding and how much we’ll all pay at the pump has been all the (road) rage recently. In late March, the government introduced legislation to allow Auckland Council to implement a regional fuel tax, and in early April the Government Policy Statement on Land Transport was published, signalling a 3-4c/l annual increase to petrol prices nationally.
A raft of unfavourable confidence surveys have been released over the last couple of months. Firstly, ANZ’s business confidence surveys for November and December showed confidence at a nine-year low. And last week the headline figure in the NZIER’s Quarterly Survey of Business Opinion (QSBO) fell into negative territory for the first time since 2015. Is the economy going downhill or are we just in an election-related blip?
Regional economic development is a high priority for the newly-formed coalition Government. Nothing highlights this more than returning MP, Minister for Regional Economic Development, and Minister for Infrastructure, Shane Jones being given a $1 billion per annum Regional Development (Provincial Growth) Fund.
This election, we’ve brought back the Infometrics Misery Index, which looks at the state of the economy compared to previous New Zealand governments, to provide a sense test of how the electorate might be feeling in the lead-up to September 23.
Labour market statistics for the June quarter will be released by Statistics NZ next week and are expected to show the job market continuing its good performance. But in spite of low unemployment and capacity pressures spreading more broadly across the labour market, rather than being concentrated in a few select industries (eg construction), there is little sign yet that wage growth has begun to pick up steam. Nevertheless, with inflation back up inside the Reserve Bank’s target band of 1-3%pa during the last three quarters and population growth likely to start tapering off, we expect to see a pick-up in wage growth over the next year.
Electric vehicles have been earmarked as a key component to meet targets under the Paris Climate agreement, according to a new report released by The BusinessNZ Energy Council (BEC) in April.
Steven Joyce’s first budget – and National’s ninth since it took up the government benches in late 2008 – set the tone for the election campaign to come, maintaining a rosy outlook for New Zealand. Although the Minister of Finance refuses to call it a “lolly scramble”, it is undeniable that New Zealand’s solid economic growth performance has left the government with the ability to start writing bigger cheques, announcing increased spending across a range of areas.