Australia & New Zealand Economics Weekly Soaring inflation to trump sluggish activity for RBA While the economic data released this week were a mixed bag, we think that soaring inflation will trump any slowdown in activity. Indeed, with wholesale electricity prices surging to record highs, it... 27th May 2022 · 6 mins read
Australia & New Zealand Economics Update RBNZ confirms hiking cycle to be followed by cuts The RBNZ sounded hawkish when it hiked rates by 50bp today, and we now think rates will rise to 3.5% by the end of this year. But the Bank endorsed our long-held non-consensus view that rate cuts will... 25th May 2022 · 3 mins read
Australia & New Zealand Economics Update New Zealand - Budget boost will exacerbate inflationary pressures While the government’s Budget was focused on equipping households to withstand surging living costs, by adding to demand we think it will cause inflation to be higher over the next year. That’s all... 20th May 2022 · 3 mins read
Australia & New Zealand Economics Weekly Wage growth still set to approach 3% by year-end While wage growth is set to reach 3% by the end of the year, this week’s labour market data didn’t contain any upside surprises that would convince the Reserve Bank of Australia to accelerate its... 20th May 2022 · 7 mins read
RBNZ Watch RBNZ to keep tightening aggressively The New Zealand economy was running hot even when the Omicron variant was disrupting activity. Now that the peak of the Omicron wave has passed, mobility is rebounding and inflation expectations are... 19th May 2022 · 7 mins read
Australia & New Zealand Chart Pack Consumption to surge even as real incomes fall We now expect Australia’s inflation to rise by more than 6% this year. Even allowing for an acceleration in earnings growth and a further solid rise in employment as immigration resumes, that will... 17th May 2022 · 11 mins read
Australia & New Zealand Economics Weekly Minimum wage to rise by 4% this year Suggestions by Labor leader Albanese that minimum wage increases in line with inflation plus productivity growth are sustainable are wide of the mark at a time when consumer prices are rising twice as... 13th May 2022 · 6 mins read
Australia & New Zealand Economics Update New Zealand - Wage growth will rise further before it falls The 6% rise in the minimum wage will help lift wage growth further this year. But a loosening labour market and smaller minimum wage hikes in the years ahead will facilitate a slow down in wage growth... 11th May 2022 · 3 mins read
Australia & New Zealand Economics Weekly Rates will rise faster than most expect The RBA started its hiking cycle at its meeting this week. While the Governor indicated that the Bank was likely to stick to 25bp hikes in the near term, we think the Bank will hike by a larger 40bp... 6th May 2022 · 4 mins read
Australia & New Zealand Data Response New Zealand Labour Market (Q1 2022) The continued tightness in the New Zealand labour market despite the omicron outbreak provides further evidence that the economy is still running hot. That’s why we expect the RBNZ to hike rates by 50... 4th May 2022 · 2 mins read
Australia & New Zealand Economics Weekly RBA will hike by 15bp next week Inflation is now surging in Australia and that surge is spreading well beyond the impact of soaring commodity prices. We therefore think the RBA needs to begin tightening policy. The RBA might want to... 29th April 2022 · 7 mins read
Australia & New Zealand Economics Weekly RBA set to hike aggressively this year The minutes of the RBA’s April meeting show that it is coming around to our view that rates will need to be hiked before long. We expect next week’s Q1 CPI data to show inflation surpassing 4%, which... 22nd April 2022 · 4 mins read
Australia & New Zealand Chart Pack Central Bankers’ confidence dilemma Inflation is surging in both Australia and New Zealand. That is putting pressure on central banks to hike interest rates to slow the economy and curb inflation. But both the RBNZ and the RBA... 21st April 2022 · 11 mins read
Australia & New Zealand Data Response New Zealand Consumer Prices (Q1 2022) The 1.8% q/q rise in consumer prices in Q1 was broadly in line with the RBNZ’s expectations, which reduces the likelihood of another 50 basis point hike in the OCR in May. But we still think high... 21st April 2022 · 2 mins read
Australia & New Zealand Economics Update Aussie and Kiwi to fall back as tightening cycles underwhelm The Aussie and the Kiwi have been amongst the best performing G10 currencies against the US dollar so far this year but, while we expect both to remain resilient in 2022, we eventually expect them to... 20th April 2022 · 4 mins read
Australia & New Zealand Economics Weekly RBA set to follow RBNZ as inflation about to surge The Reserve Bank of New Zealand delivered the 50bp rate hike we were anticipating this week and we think that the Reserve Bank of Australia will embark on its own tightening cycle in June. With the... 14th April 2022 · 5 mins read
