Economic research & market strategy

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Economic research & market strategy

Weekly Commentary

Weekly coverage of recent and upcoming economic and market events.


To view archived reports click here.

Economic Data Reports

Previews and reviews of the latest economic data releases.

Home Truths: Westpac's monthly commentary on the NZ housing market - 12 October 2015
A fresh perspective on the New Zealand housing market.

Cost-cutting drive - NZ Consumer Price Index preview, Q3 2015 - 8 October 2015
A sharp drop in car registration fees is expected to take annual inflation down to a new low for this cycle. We expect the weaker New Zealand dollar to have had only a modest impact on prices to date.

Fortnightly Agri Update - 7 October 2015
The latest developments in New Zealand's agri markets.

NZ Local Knowledge - 6 October 2015
A very strong batch of activity data in July and August makes up for some of the disappointing softness over the first half of this year. Even so, we expect housing and agriculture to slow the economy's momentum again over coming months. 

Q3 NZ Quarterly Survey of Business Opinion - 6 October 2015
Today’s report highlighted that economic activity has held up in recent months. However, confidence in the outlook has fallen sharply. 

Earnings concerns growing - NZ Employment confidence Q3 2015 - 28 September 2015
New Zealanders have become increasingly concerned about the state of the labour market. 

A tale of two economies - Westpac McDermott Miller Regional Economic Confidence, September quarter 2015 - 24 September 2015
Regional economic confidence remained flat across New Zealand in September, with a dichotomy emerging between dairying regions and those with less dairy exposure. 

Will we see a sustained pick-up in inflation? - 23 September 2015
Inflation will rebound over the coming months, but we don’t expect this to be sustained. 

Down but not out - NZ Consumer Confidence Index, Q3 2015 - 21 September 2015
Consumer confidence has taken another step lower as the economic climate has soured. But for now, it suggests spending is coming off the boil, not grinding to a halt.

Meek rebound - NZ GDP review, Q2 2015 - 17 September 2015
GDP growth remained sluggish in the June quarter, even with some sectors bouncing back from temporarily depressed levels. The weaker than expected result will strengthen the case for OCR cuts.

Better with hindsight - NZ current account review, Q2 2015 - 16 September 2015
New Zealand's current account deficit widened in the June quarter, although revisions helped to improve the annual balance. We expect a further deterioration over the next year as the impact of lower dairy prices flows through.

Fortnightly Agri Update - 16 September 2015
The latest developments in New Zealand's agri markets.

RBNZ MPS review, September 2015 - Doubling down on the dollar - 10 September 2015
As expected, the RBNZ cut the OCR 25bps, and signalled one further cut at an unspecified date.

Faster but slower - NZ GDP and Current Account preview, Q2 2015 - 9 September 2015
GDP growth is likely to pick up in the June quarter as some temporary factors are reversed. But the pace of growth has clearly slowed since last year, reflecting the dairy downturn and the peak in the earthquake rebuild.

NZ Local Knowledge - 4 September 2015
The New Zealand economy defied the gloom with a strong batch of data over July. Nevertheless, we expect the dairy downturn and the peak of the quake rebuild to weigh on growth over the next two years.

RBNZ MPS preview, September 2015 - A tough line to cross - 4 September 2015
We expect the RBNZ will cut the OCR 25bps, and signal one further cut at an unspecified date.

NZ building work put in place - June quarter 2015 - 3 September 2015
Total building work put in place rose 1.6% in the June quarter, taking the level of building activity to its highest level in ten years. June's increase in building work was underpinned by a 5% increase in non-residential construction. This offset a 1% decline in residential construction.Five years on from the first of the devastating earthquakes that struck the Canterbury region, we take a look at how the reconstruction process is evolving.

Fortnightly Agri Update - 2 September 2015
The latest developments in New Zealand's agri markets.

Fortnightly Agri Update - 19 August 2015
The latest developments in New Zealand's agri markets.

Pulling back – NZ retail sales, June quarter 2015 - 14 August 2015
Retail spending growth slowed sharply in the June quarter, dampened by the rebound in petrol prices. At this stage we are seeing a softening in spending – not a collapse. However, we do expect to see a more pronounced weakening in demand in the economy over the coming months.

Home Truths: Westpac's monthly commentary on the NZ housing market - 14 August 2015
A fresh perspective on the New Zealand housing market.

Labour demand softening, conditions to ease further. NZ labour market review June quarter 2015 - 5 August 2015
June quarter labour market data have added to signs that the economy has lost momentum through mid-2015.

Fortnightly Agri Update - 5 August 2015
The latest developments in New Zealand's agri markets.

NZ Local Knowledge - 4 August 2015
Momentum in the domestic economy is slowing, as low dairy prices undermine confidence in other sectors.

Labour demand softening while wage growth remains low - NZ Labour Market Preview, June 2015 - 31 July 2015
We expect the unemployment rate to rise to 5.9% in June as demand for workers softens. Wage inflation is expected to have remained low, with any material pick-up someway off. With wage growth likely to remain low and consumer price inflation starting to pick up, households’ purchasing power will come under increasing pressure over the coming year.

RBNZ OCR Review July 2015 - Down to the waterline - 23 July 2015
As expected, the RBNZ cut the OCR 25 basis points and signalled more to come.

Home Truths: Westpac's monthly commentary on the NZ housing market - 22 July 2015
The latest data show Auckland's house prices are "going vertical", while other regions stagnate. Recent policy changes may alter that mix.

How low will it go - RBNZ OCR preview July 2015 - 21 July 2015
Our base case is a 25bps OCR cut on Thursday, but there is a clear risk of a 50bps cut. 

Pump priming - NZ Consumer Price Index review, Q2 2015 - 16 July 2015
Domestic inflation pressures remain very subdued, leaving the Reserve Bank increasingly reliant on a weaker NZD in order to achieve its inflation target. We now expect the OCR to be reduced to 2% by the end of this year.

Fortnightly Agri Update - 16 July 2015
The latest developments in New Zealand's agri markets.

Fill 'er up - NZ Consumer Price Index preview, Q2 2015 - 10 July 2015
We expect a 0.7% rise in the June quarter CPI, lifting annual inflation to a still-subdued 0.5%. The steep drop in fuel prices last quarter has largely been reversed, but elsewhere inflation pressures remain soft and the effects of a weaker New Zealand dollar will take some time.

NZ Local Knowledge - 7 July 2015
The New Zealand economy has held up better than the market gloom would suggest, though its momentum remains somewhat housing-centric.

Fortnightly Agri Update - 2 July 2015
The latest developments in New Zealand's agri markets.

Workers concerned about earnings  – Q2 Westpac McDermott Miller Employment Confidence - 29 June 2015
New Zealanders have become less confident about the health of the labour market.

Milk turns sour - NZ Regional Economic Confidence, Q2 2015 - 25 June 2015
Regional economic confidence fell in the June quarter, especially in the more dairying-intensive regions as the prospect of a second year of low returns weighed on sentiment.

Off the boil - NZ Consumer Confidence Index, Q2 2015 - 22 June 2015
Consumer confidence fell to 113.0 in the June quarter. This is the lowest level since early 2013, though confidence remains slightly above average. Concerns around the economy drove much of the decline – unsurprisingly so given the downturn in the dairy sector’s prospects. Consumers’ reported spending appetites have also come off from recent peaks, but remain moderately upbeat.

Falling short - NZ GDP review, Q1 2015 - 18 June 2015
GDP growth grew just 0.2% in the March quarter, and while there were some temporary negatives, the overall picture for domestic demand wasn't flattering. We now expect OCR cuts in both the July and September reviews.

Mixed fortunes - NZ current account review, Q1 2015 - 17 June 2015
Falling dairy export earnings were partly cushioned by cheaper oil and strong growth in tourist spending. We expect the deficit to widen further over the course of this year, but remaining well short of the alarming levels that were reached last decade.

Fortnightly Agri Update - 17 June 2015
The latest developments in New Zealand's agri markets.

Home Truths: Westpac's monthly commentary on the NZ housing market - 12 June 2015
The latest data show Auckland's house prices are "going vertical", while other regions stagnate. Recent policy changes may alter that mix.

Popping down to the dairy - RBNZ MPS, June 2015 - 11 June 2015
The RBNZ cut the OCR and signalled one more cut this year. We expect that follow-up cut to come in September.

Tapping the brakes - NZ GDP and Current Account preview, Q1 2015 - 10 June 2015
We expect GDP growth to slow to 0.6% for the March quarter, with dry weather temporarily slowing milk production but domestic demand otherwise intact. The current account deficit widened on an annual basis, despite cheaper oil imports and strong tourist spending over the quarter.

NZ Local Knowledge - 5 June 2015
Domestic activity was modestly stronger on balance in April, with the housing market in fine form ahead of the new lending and tax rules that were unveiled in May.

Not so fast – a final word before next week's RBNZ MPS5 June 2015
This bulletin outlines our expectations for next week's RBNZ Monetary Policy Statement.

Build me up – Q1 Building work put in place - 4 June 2015
Construction activity rose 1.0% in the March quarter, following a 0.3% rise in the December quarter. This was above our expectation for a 0.5% increase.

Fortnightly Agri Update - 3 June 2015
The latest developments in New Zealand's agri markets.

Brief detour - NZ Terms of Trade review, Q1 2015 - 2 June 2015
New Zealand's terms of trade saw a temporary bounce in the March quarter, as the plunge in world oil prices outweighed the falls in commodity export prices. We think the terms of trade's cyclical downturn won't be completed until later in the year. 

Hold your horses - Outlook for the NZ OCR - 28 May 2015
Calls for OCR cuts are emerging. We view a June OCR cut as unlikely, and a cut later in the year as uncertain. 

A closer look - full analysis the 2015 NZ Budget - 21 May 2015
Comprehensive coverage of the New Zealand Government's Budget 2015

Taking the long view - NZ Budget 2015 First Impressions, May 2015 - 21 May 2015
The 2015 Budget projects a return to surplus next year despite low inflation weighing on revenue projections. We're concerned that the forecast of ever-rising surpluses in later years, even as the Christchurch rebuild winds down, is too optimistic.

Fortnightly Agri Update - 20 May 2015
The latest developments in New Zealand's agri markets.

Keeping a tight rein - NZ Budget 2015 preview, May 2015 - 18 May 2015
Subdued inflation will weigh on tax revenue projections again in this year's Budget, ensuring a continuation of the disciplined approach to spending seen in recent years. 

Fired up - NZ retail sales, Q1 2015 - 14 May 2015
Real retail sales surged in the March quarter, boosted by the windfall consumers enjoyed from falling fuel prices. Excluding fuel, the value of spending rose the fastest since 2006. The combination of turbo-charged retail activity and low inflation is a conundrum for the Reserve Bank. Prospects of OCR cuts this year remains very uncertain. 

A new take on the Auckland housing market - Home Truths Special Edition - 14 May 2015
We propose an explanation for Auckland's recent surge of house price inflation that actually matches the facts.

Line call – Q1 Labour market review: April 14, 2015 - 6 May 2015
Labour market data showed strong demand, strong capacity, and weak wage growth.

Fortnightly Agri Update - 6 May 2015
The latest developments in New Zealand's agri markets.

NZ Local Knowledge - 5 May 2015
A strong set of results for the March month, though growth for the first quarter as a whole is shaping up as slightly softer than last year's pace.

Labour market tightening, but wage growth still low - Q1 2015 labour market preview: Wednesday 6 May, 10:45am - 1 May 2015
We expect that the unemployment rate will push down to 5.5% in early 2015 as strengthening domestic demand boosts demand for labour. 

Stamp of approval - RBNZ OCR Review - 30 April 2015
The RBNZ has given the official "stamp of approval" to the conditional easing bias already announced in a speech last week. 

The cat is out of the bag - RBNZ OCR preview - 24 April 2015
In a speech this week the RBNZ adopted a more dovish monetary policy stance. Next week's OCR Review will serve mainly as confirmation. 

Grow NZ survey results - 22 April 2015
Results from Westpac's recent survey of SMEs, focussing on use of technology.

Increasingly isolated inflation - NZ Consumer Price Index review, Q1 2015 - 20 April 2015
Annual inflation slowed to near zero in the March quarter, led by a sharp one-off decline in fuel prices. However, ex-fuel inflation was also very subdued; even previous pockets of strength such as housing-related inflation are looking more mixed.

Fortnightly Agri Update - 16 April 2015
The latest developments in New Zealand's agri markets.

More for less – Q1 NZIER Quarterly Survey of Opinion - 14 April 2015
Business confidence pulled back slightly in early 2015, as did expectations for the coming three months. Nevertheless, today’s business sentiment survey continues to point to solid growth through early 2015.

Under the pump - NZ Consumer Price Index preview, Q1 2015 - 14 April 2015
We expect inflation to slow to 0.2% for the year to March, the lowest since 1999. A sharp fall in petrol pump prices accounts for the latest decline, but underlying inflation pressures are likely to have remained subdued as well.

NZ Local Knowledge - 2 April 2015
A stronger tone to the data in February after a slow start to the year. The impact of dry weather on GDP growth is shaping up to be less than initially feared.

Fortnightly Agri Update - 2 April 2015
The latest developments in New Zealand's agri markets.

Things are gonna get better – Westpac McDermott Miller Employment Confidence, March 2015 quarter - 30 March 2015
New Zealanders have become more confident about the outlook for the labour market, consistent with continuing strength in GDP growth. Despite softness in consumer price inflation, expectations for earnings growth have remained resilient. This will allay some of the RBNZ’s concerns about a downshift in wage and pricing setting behaviour.

Rural relief - NZ Regional Economic Confidence, Q1 2015 - 27 March 2015
New Zealanders' confidence in their region's economic prospects improved in the March quarter, particularly in the rural areas where confidence took the biggest knock at the end of last year.

Town and Country - NZ consumer confidence, Q1 2015 - 23 March 2015
Consumer confidence rose over the past three months (from 114.8 to 117.4) and is once again comfortably above average, consistent with recent signs of buoyant retail activity. Surprisingly, the lift in confidence was biggest in rural regions and smaller centres. Confidence in the main urban centres continues to be healthy rather than exuberant.

Face value - NZ GDP review, Q4 2014 - 19 March 2015
Today's GDP figures can be taken as given: the New Zealand economy is growing at an above-trend pace and has been doing so for some time.

Devil in the details - NZ current account review, Q4 2014 - 18 March 2015|
Weaker dairy export prices drove a widening of the current account deficit in the December 2014 quarter, and will continue to do so over the course of this year. However, stronger tourism earnings and profits for New Zealand-based firms sent positive signals about the domestic economy.

Fortnightly Agri Update - 18 March 2015
The latest developments in New Zealand's agri markets.

Home Truths: Westpac's monthly commentary on the NZ housing market - 16 March 2015
A mixed tone has crept into recent housing market data, but we still expect prices to rise and the RBNZ to tighten further its restrictions on mortgage lending.

The scuttlebutt from Europe - notes from Dominick Stephens' tour of Europe - 13 March 2015
This brief note describes the mood in UK and European dealing rooms, as well as summarising Northern Hemisphere perspectives on New Zealand.

Keep it simple - RBNZ MPS review - 12 March 2015
The Reserve Bank has maintained its "firmly on hold" outlook for the OCR.

Keeping pace - NZ GDP and Current Account preview, Q4 2014 - 11 March 2015
We expect GDP growth to have slowed, though only to around trend, in the December quarter. The current account deficit is set to widen as the full force of last year's drop in dairy export prices is felt.

NZ Local Knowledge - 6 March 2015
A softer tone to the data over January, not all of which can be attributed to drought.

Keep it steady Monetary Policy Statement preview - 5 March 2015
The RBNZ is expected to keep the OCR on hold next week, and the accompanying press statement is expected to echo the neutral tone of the January OCR review. The RBNZ’s forecast for the 90-day interest rate is expected to be revised down, consistent with rates remaining on hold at least until early 2016.

Strong foundations - NZ building activity survey, Q4 2014 - 4 March 2015
Building work rose just 0.3% in the December quarter, but this capped off a year of very strong growth for the industry.

Fortnightly Agri Update - 4 March 2015
The latest developments in New Zealand's agri markets.

The end is nigh - NZ Terms of Trade, Q4 2014 - 2 March 2015
Prices for dairy products, New Zealand's major export, continued to fall in the December quarter, but favourable movements in other commodity prices softened the blow. Indeed, recent commodity price shifts suggest that the terms of trade will bottom out soon at a very high level.

Fortnightly Agri Update - 18 February 2015
The latest developments in New Zealand's agri markets.

A tale of two regions - NZ retail trade, Q4 2014 - 16 February 2015
Real retail sales accelerated further in the December quarter, rising 1.7%.

Home Truths: Westpac's monthly commentary on the NZ housing market - 13 February 2015
A fresh perspective on the New Zealand housing market.

NZ Local Knowledge - 11 February 2015
An emphatic post-election rebound in activity in October-November, particularly in the housing market.

Stronger than it looks- Q4 labour market review - 4 February 2015
Unemployment unexpectedly rose in December. However, conditions in the labour market have actually remained firm, with strong growth in numbers employed.

Fortnightly Agri Update - 4 February 2015
The latest developments in New Zealand's agri markets.

Wage growth to remain soft - Q4 labour market preview -  30 January 2015
The robust domestic economy is supporting increases in employment. But it is also encouraging more people to enter the labour force, which is limiting declines in the unemployment rate.

A new phase - RBNZ OCR review, January 2015 - 29 January 2015
The Reserve Bank has abandoned its hiking bias, and is now ambivalent about future OCR moves.

A new tack - RBNZ OCR preview - 22 January 2015
Annual inflation has fallen below 1% again, and by early this year will be close to zero. The Reserve Bank has room to look past the sharp fall in oil prices, but the timing of future hikes is becoming increasingly distant, and financial markets are more likely to be animated by the idea of interest rate cuts.

The tables have turned - NZ Consumer Price Index review, Q4 2014 - 21 January 2015
Annual inflation has fallen below 1% again, and by early this year will be close to zero. The Reserve Bank has room to look past the sharp fall in oil prices, but the timing of future hikes is becoming increasingly distant, and financial markets are more likely to be animated by the idea of interest rate cuts.

Fortnightly Agri Update - 21 January 2015
The latest developments in New Zealand's agri markets.

Sweet spot – NZIER Quarterly Survey of Business Opinion, December 2014 - 20 January 2015
General business confidence remains at above average levels and businesses’ reported own activity has increased.

Q4 Employment Confidence January 2015 - 19 January 2014

Lower and lower - NZ Consumer Price Index preview, Q4 2014 - 15 January 2015
Consumers’ economic confidence has tumbled in Southland and the Waikato, two of New Zealand’s main dairying regions. By contrast, economic confidence in Canterbury – another centre of the dairy industry – actually rose in the quarter, a testament to the importance of the post-earthquake rebuild. Over the last six months the gloss has come off confidence in most regions, though optimists continue to predominate by a decent margin in the three main centres and the Bay of Plenty.

In-depth review of topical issues.

Deeper insights

  • An update on New Zealand's migration outlook - 8 October 2015
    Net migration has reached record highs, thanks to a rising inflow of foreign migrants and a drop in the outflow of New Zealanders. Weak offshore labour markets could keep net migration high for a while yet. But over the longer term the current rate of population growth looks unsustainably high.
  • Industry insights – Oil, Gas and mining - 22 September 2015
    The outlook for Gold mining is decidedly stronger than for Coal mining, and Oil and gas.  We expect prices for coal and oil to remain low, creating the risk of job losses and in the case of oil and gas, far less exploration in New Zealand.  Meanwhile gold is expected to benefit from greater uncertainty in the global outlook, as an investor safe haven.
  • Outlook for Auckland residential construction - 18 August 2015
    Auckland continues to build fewer dwellings than is required to meet the demands of population growth. We estimate that the Auckland construction industry can deliver 10,800 dwellings a year within two years without risk of overbuilding, but that levels higher than this will be hard to achieve.
  • Peak or Plateau: Update on the Canterbury rebuild - 17 July 2015
    Reconstruction in Canterbury is now well advanced and spending appears to have reached a peak. We expect that construction activity in the region will remain elevated for some time. However, going forward reconstruction isn’t going to provide the same sort of boost to growth and employment as it has in recent years. And eventually the rebuild will become a drag on economic conditions.
  • A new take on the Auckland housing market - 14 May 2015
    This is an unabridged resend of our Home Truths Special Edition, sent for the benefit of customers who subscribe to our economic bulletins but not our regular housing market commentary.
  • Grow NZ survey results - 22 April 2015
    Results from Westpac's recent survey of SMEs, focussing on use of technology.
  • Focus on the Canterbury rebuild - 9 April 2015
    The Canterbury rebuild will be our nation’s largest ever construction project, and it will play an important role in shaping nationwide economic conditions for a number of years. In this Bulletin, we look at how the reconstruction process is evolving, and what we expect to see going forward.
  • Great expectations - What drives the New Zealand dollar - 2 October 2014
    The latest developments in New Zealand’s agri markets.
  • NZ labour force participation - In or out - 9 September 2014
    New Zealand's labour force participation rate has risen sharply in the last two decades to become one of the highest in the OECD. We show that this outperformance has been driven by older people, with New Zealand's retirement policies minimising the disincentive to working later in life. Our view is that the trend toward later retirement will continue to head off the effects of an ageing workforce for another couple of years.
  • Where should we build now? Housing supply and the construction outlook in regions of New Zealand - 26 March 2014
    By calculating the number of people per house in regions of New Zealand, we gain insights into the likely trajectory and locus of construction activity in New Zealand ex Canterbury.
  • New Zealand's neutral OCR: a moving feast - 22 October 2013
    The neutral OCR will be a crucial determinant of the peak of the upcoming OCR hiking cycle. Neutral may be around 4.5% today, but there are strong reasons to expect it will rise over the coming few years. This short bulletin explains why we think neutral will reach 5%.
  • Eye on the horizon - longer-term economic forecasts for New Zealand - 17 October 2013
    We are often asked for our longer-term economic forecasts. In this bulletin we respond to those requests by extending our forecasts out to 2023. We begin by briefly describing how we expect the current cycle to play out. We then outline our key longer-term assumptions.
  • Sleeping beauty is awake - an update on the NZ tourism sector - 24 September 2013
    A review of the recent history and near-term prospects of New Zealand's tourism industry.
  • Lowering the boom - RBNZ restricts high-LVR lending - 20 August 2013
    The RBNZ has brought its macroprudential toolkit into action, setting limits on the share of high loan-to-value ratio mortgages. We expect an initial 'sticker shock' for the housing market, but a limited impact over the longer term; interest rates are the main determinant of housing demand.
  • Hair of the Dog - 10 June 2013
    In this article we explain why we expect New Zealand's rising housing market to boost household spending.
  • Drought, Chinese Mums, and the price of milk - 16 April 2013
    We take a look at the unexpected consequences of the 2013 New Zealand drought
  • Where should we build? 19 March 2013
    A look at housing supply and the construction outlook in all regions of New Zealand except Canterbury. 
  • Tool time - 4 March
    A first look at the Reserve Bank's suite of macroprudential policy tools - their purpose, the options, and when they might first be used.
  • A season of two halves - 1 March 2013
    A primer on dry weather in New Zealand
  • Realities of NZD intervention - 22 February 2013
    All you need to know about the Reserve Bank's approach to exchange rate intervention.

  • When rising tides don’t lift all boats - 20 February 2013
    Household Income Growth since 2008
  • President Obama and the Fiscal Cliff - 12 November 2012
    Without an agreement over the fiscal cliff, the US is facing a potential 4ppt reduction in net government spending in FY2013 that would almost surely result in a recession.
  • Gentlemen's agreement - 18 September 2012
    Incoming RBNZ Governor Graeme Wheeler is due to sign a new Policy Targets Agreement soon. We don't expect substantial changes to the document, which covers only a narrow aspect of the Governor's role - but bigger changes could be on the way in coming years.
  • Delever me? - 11 September 2012
    A closer look at the drivers of household debt. We conclude debt is likely to stay historically high, but grow more slowly than last decade.
  • Save us! - 20 August 2012
    We review the evidence on New Zealand's saving performance and conclude it's probably not been as dire as official measures suggest.
  • Rebuilding a City - 16 August 2012
    Here we collate some of the available evidence to build a picture of how the local economy and the rebuild are progressing.
  • Eurogeddon - 3 July 2012
    An investigation into what would become of New Zealand in a scenario of financial meltdown in Europe.
  • New man at the helm - 26 June 2012
    Graeme Wheeler has been appointed Governor of the Reserve Bank of New Zealand, effective 25 September.
  • Nice for now - 27 March 2012
    The New Zealand housing is resurgent for now, but the cheer may not last.
  • Three points of a triangle - 19 March 2012
    The debate on New Zealand interest rates has fractured into three points of a triangle. This could throw up interesting scenarios in the year ahead.
  • Time to fix - 2 March 2012
    The balance of risks for mortgage borrowers now favours fixing.
  • Changing the watch - 1 February 2012
    Prospects for the RBNZ as Governor Alan Bollard announces he will step down in September.
  • The construction sector: past, present and future - 14 December 2011
    The construction sector has been a notable area of weakness in the New Zealand economy over the last few years, however we expect a significant turnaround in fortunes ahead, driven by building in Auckland and Canterbury.
  • Hold your horses - 9 December 2011
    Our model predicts the NZD/AUD exchange rate will eventually rise to a more normal level, but not before global credit conditions improve.
  • The turning Tide - 23 November 2011
    An analysis of trans-Tasman migration and how it relates to Australian and NZ unemployment.
  • Digesting Dairy Prices - 18 August 2011
    A discussion of the outlook for dairy prices in an uncertain world.
  • Ear to the ground - 10 August 2011
    Anecdotes about the rebuild from Christchurch
  • US Fiscal Folly - 4 August 2011
    US lawmakers dodge a self-inflicted crisis, but do little to address the fiscal malaise that affects all levels of Government.
  • Disasters in history - 8 July 2011
    A review of the lessons from the Napier, Kobe and Chile earthquakes, as well as Hurricane Katrina.
  • A matter of Exchange - 24 June 2011
    We review the links between saving, interest rates, and the exchange rate, and interrogate some dubious claims.
  • Forestry Sector Overview - 10 June 2011
    An overview of one of New Zealand's key primary industries including a discussion of the differing fortunes of forest growers and wood processors.
  • Shape of things to come - 7 March 2011
    Discusses how the Christchurch Earthquake has radically altered the New Zealand's economic outlook
  • Why so glum? - 15 December 2010
    Global financial stress has been a key driver of the low NZD/AUD exchange rate since 2009.
  • Raising interest - 28 September 2010
    Investigates the responsiveness of retail bank deposits to interest rates.
  • Shaky Isles - 6 September 2010
    Assessment of the possible impact of the September 2010 Canterbury earthquake.
  • Crossing the line - 23 August 2010
    NZD/AUD exchange rate model update
  • Being effective - 17 August 2010
    The last of our series on the interest rate landscape shows that borrowing costs have continued to ease even without RBNZ action.
  • Neutral about neutral - 16 August 2010
    The third instalment in our series on the new interest rate landscape discusses the neutral OCR, a concept that proves surprisingly elusive.
  • A matter of interest - 12 August 2010
    The second of our series on the new interest rate landscape, we trace through six important flow-on effects from higher bank funding costs.
  • Before and after - 9 August 2010
    In the first of a series on the new interest rate landscape, we review how bank funding has been affected by the Global Financial Crisis.
  • House prices - further to fall - 2 July 2010
    We believe house prices have further to fall, not least because of a change to the rate of income tax which has reduced the tax incentive to invest in rental property.
  • Ease the squeeze, please - 25 June 2010
    New Zealand is building too few houses to keep up with population growth – a housing squeeze lies ahead.
  • The big GST step - 12 February 2010
    Tax reforms should provide improved incentives over the longer term, but not without sizeable disruptions at the time of implementation.
  • Sectoral performance - 15 January 2010
    Winners and losers in the recession and recovery.
  • Tax and house prices - 16 December 2009
    Changes to the tax system are likely to reduce house values.
  • Split fortunes - 4 December 2009
    Manufacturers have been squeezed by rising costs and a strong NZ dollar. An improving world economy will help some sectors, but non-food manufacturing will continue to lag.
  • This time is different - 25 November 2009
    Eight decades of recoveries.
  • Housing encore - 12 November 2009
    Update on the New Zealand housing market.
  • Buffet or buffer - 24 September 2009
    Does the exchange rate hinder or help commodity exporters?
  • No need to get cross - 15 September 2009
    NZD/AUD model update.
  • Getting more for your money - 20 August 2009
    Consumers weren’t the only party animals this decade – a stronger terms of trade underpinned spending and borrowing across all sectors.
  • Variable gravity - 20 August 2009
    Practices in the NZ housing market are vastly different to those in the US.
  • The return of HEW - 10 August 2009
    Homeowners have switched from drawing on housing wealth to accumulating it – though the pace is slowing.
  • When cash is not currency - 10 August 2009
    The relationship between the OCR and the exchange rate is not stable enough to serve as a policy lever.
  • Funding it tough - 23 June 2009
    Running the ruler over claims about bank margins in the wake of the Global Financial Crisis.
  • Flu jab - 18 June 2009
    The potential impact of an H1N1 influenza epidemic on the NZ economy.
  • Flash in the pan - 4 June 2009
    Housing pickup unsustainable
  • The money tree - 17 April 2009
    Quantitative easing: what it is, and the chances of NZ going down this path.
  • A changing climate - 4 March 2009
    New Zealand’s options for addressing climate change.


NZ Occasional Papers

NZD/AUD forecasting modelSubmission to monetary policy inquiry 2007Labour force participation in NZNZ inflation expectationsA Global Interest Rate ModelExplaining the NZ-Australian exchange rateTrans-tasman interest ratesSaving and investment in NZ

Quarterly Economic Overview

Quarterly publication providing an in-depth economic outlook, topical issues and forecasts.

August 2015
New Zealand's economic outlook has changed. There has been a ferocious decline in the global price of New Zealand's biggest export, and the Canterbury rebuild has peaked nine months earlier than anticipated. This Economic Overview discusses the revised outlook, including our expectation that GDP growth will fall below 2%, unemployment will rise to 6.5%, and the OCR will fall to 2.0%.

May 2015
A summary of the prospects for New Zealand's economy, interest rates, exchange rate and agricultural sector, plus an overview of the global economy.

February 2015
A summary of the prospects for New Zealand's economy, interest rates, exchange rate and agricultural sector, plus an overview of the global economy.

November 2014
A summary of the prospects for New Zealand's economy, interest rates, exchange rate and agricultural sector, plus an overview of the global economy.

August 2014
A summary of the prospects for New Zealand's economy, interest rates, exchange rate and agricultural sector, plus an overview of the global economy.

May 2014
As New Zealand's economic upswing rolls on, we are starting to see encouraging signs that the economy still has room to grow without generating excessive inflation. However, we still expect a substantial OCR hiking cycle over the coming three years. This year's election is a key risk event - the Special Topic this quarter provides a guide for financial markets.

February 2014
The construction boom and rising house prices are now maturing themes for the New Zealand economy. This quarter, the NZ Economic Overview focusses on the causes and consequences of New Zealand's stratospheric export commodity prices.

November 2013
Comprehensive analysis and forecasts of the New Zealand economy, global economy, and financial markets.

August 2013
New Zealand is now clearly in the grip of a self-sustaining economic upswing, driven by construction activity and house prices. Our Economic Overview discusses the implications for interest rates while noting that the upturn will prove temporary. The remaining "forks in the road" for New Zealand include the question of Fed tapering and the possible impact of the RBNZ's new mortgage restrictions. Our expectation of a substantial OCR hiking cycle has not changed.

May 2013
The New Zealand economy is caught in a tug-of-war between high GDP growth and low inflation. The May Economic Overview includes articles on the New Zealand economy, New Zealand dollar, inflation and interest rates, and the international outlook. Our new section, Agricultural Outlook, covers the impact of drought on the New Zealand economy. And our special topic discusses the Reserve Bank's macroprudential tools.

February 2013
The economy is starting to move as the Canterbury rebuild hits its straps. But the stratospheric exchange rate has kept inflation in check. So the RBNZ has been able to keep interest rates low. The predictable result has been improved consumer confidence and higher house prices. Our forecasts for 2013 follow the same formula, but with greater intensity on all fronts.

November 2012
After a strong start to 2012, the New Zealand economy has lost momentum, reflecting the patchiness of the current construction-led economic upturn.

August 2012
Growth is accelerating but low inflation and the strong exchange rate mean interest rates will stay low for longer. This edition of the Economic Outlook discusses the possibility that rising house prices will reignite New Zealand's economic imbalances.

May 2012
The global economy has cooled as expected, but the surprisingly strong NZ dollar and soft inflation point to low interest rates for a while longer.

February 2012
Export conditions are deteriorating, but we envisage a dip rather than a disaster. Low interest rates will boost the housing market.



Quarterly focus on rural developments, trends and outlook.

January 2013
In this quarter’s Agribiz, we look at why lamb prices fell hard over 2012 while beef prices remained at near record highs, and take a look at the prospects for rural land market.

October 2012
In this quarter’s Agribiz we look at some of the risks higher global food prices bring for the global economy, and investigate what impact higher grain prices might have on prices of key New Zealand exports such as meat and dairy.

July 2012
In this quarter’s Agribiz we examine recent moves in dairy prices and look at what the outlook might be from here.

April 2012
In the April Agribiz, we shine a spotlight on recent developments in the meat sector.

January 2012
The international outlook remains stormy, and in this quarter's Agribiz we take a closer look at what this might mean for interest rates and the NZD.

Consumer Confidence

Quarterly survey on consumer activity, spending and expectations of the current economy.


Employment Confidence

Quarterly survey on employer activity, spending and expectations of the current economy.


Regional Economic Confidence

Quarterly survey on regional employer activity, spending and expectations of the current economy