Bite-sized video updates on the New Zealand economy and markets.
Chief Economist Dominick Stephens presents economic insights in this two-minute weekly video.
Business activity was stronger in September, but confidence is down sharply. Dairy prices are higher but still low. Inflation is expected to be very weak in September.
Economic activity has shown a surprising new lease of life, even before the recent bounce in dairy prices. The housing market has been particularly strong ahead of the new tax and lending rules.
With resilience in economic conditions through mid-2015 and a pick-up in dairy prices, we expect that the RBNZ will pause its cutting cycle in October, before restarting in December. Looking further ahead, slowing domestic growth means that the economy will need a significant boost in the form of lower interest rates to generate a sustained lift in inflation.
Dairy prices are recovering very nicely, but the overall economy is even slower than previously thought.
Chief Economist Dominick Stephens presents economic insights in this bite-sized monthly video updates.
We hope you find these updates helpful in shaping a view of what's in store for you beyond the farm gate.
Dairy farmers' fortunes have improved dramatically in the last month. But we question whether the fundamentals of the global dairy market have really changed all that much.
A global economic slowdown, led by China, will be felt by many New Zealand primary exporters. But dairy is dancing to its own beat - we have lifted our forecast of this season's farmgate milk price.
Plunging dairy prices will be a serious challenge for the whole economy. We foresee slower GDP growth, rising unemployment, a falling exchange rate and the OCR dropping to 2.0%. But the last two of these will be very helpful for many other primary industries.
International dairy prices have continued to fall in a volatile global environment. However, the falling New Zealand dollar provides an important buffer.
All opinions, statements and analysis expressed are based on information current at the time of writing from sources which Westpac believes to be authentic and reliable. Westpac issues no invitation to anyone to rely on this information current t time of writing and intends by this statement to exclude liability, to the extent permitted by law, for any such opinion, statement and analysis. The content of this material is a guide only. It does not take into account your personal financial situation and goals. You should obtain independent professional advice.