Australia & New Zealand Economics Weekly Strong labour market doesn’t mean RBA will tighten The stronger than expected labour market data will have been a nice surprise to the RBA with the unemployment rate now below its year-end forecast. But we had always expected the unemployment rate to... 19th March 2021 · 4 mins read
Australia & New Zealand Data Response New Zealand GDP (Q4 2020) The solid decline in activity in Q4 means that a second recession is imminent as GDP is bound to decline in Q1. 17th March 2021 · 2 mins read
Australia & New Zealand Economics Weekly RBA underlines determination to keep policy loose The Reserve Bank of Australia this week pushed back against mounting expectations of policy tightening both via its market operations as well as via a dovish speech by Governor Lowe. We reiterate our... 12th March 2021 · 6 mins read
Australia & New Zealand Economics Update New Zealand - Border closure to knock 2% off GDP by end-2022 The slow progress in rolling out vaccines in New Zealand means that its border may only be reopened by the end of this year. With net migration boosting population growth by around 1%-pt per annum... 8th March 2021 · 3 mins read
Australia & New Zealand Economics Weekly RBA taking higher bond yields in its stride The Reserve Bank of Australia’s half-hearted response to the surge in government bond yields underlines that it is not overly worried about the impact of higher borrowing costs on the economy. But... 5th March 2021 · 4 mins read
Australia & New Zealand Chart Pack Wage growth near its trough Labour markets in both countries have tightened in recent months. In Australia, the unemployment rate has fallen from a peak of 7.1% to just 6.4% in January. And other measures of spare capacity have... 1st March 2021 · 11 mins read
Australia & New Zealand Economics Update RBNZ’s housing focus could bring forward rate hikes We doubt that the Reserve Bank of New Zealand’s new obligation to consider house prices will drastically change the outlook for monetary policy. But given that house price growth remains very strong... 26th February 2021 · 3 mins read
Australia & New Zealand Economics Weekly Mixed outlook for bond yields Bond yields surged to a two-year high this week. While we agree with market expectations that the RBNZ will hike interest rates to 1% by 2023, we think that markets have gone too far in pricing in... 26th February 2021 · 6 mins read
Australia & New Zealand Economics Update Pessimistic RBNZ set to be surprised The Reserve Bank of New Zealand (RBNZ) sounded dovish when it left policy settings unchanged today, but we still expect the Bank to begin increasing rates next year. 24th February 2021 · 3 mins read
Australia & New Zealand Economics Weekly Economy increasingly shrugging off lockdowns Short localised lockdowns are becoming increasingly common in New Zealand and Australia as governments seek to contain virus outbreaks. But the impact on consumption is typically short-lived and... 19th February 2021 · 7 mins read
RBNZ Watch Bank to continue unwinding stimulus Economic data since the Bank’s last meeting have shown the New Zealand economy recovering at a remarkable pace. The case for further monetary stimulus is therefore weak. As such, we expect the Bank... 17th February 2021 · 6 mins read
Australia & New Zealand Economics Weekly New Zealand’s house prices will keep rising strongly The RBNZ is responding to the recent surge in house prices by reimposing and later tightening LVR restrictions on mortgage borrowers. The impact of LVR restrictions on the housing market has been... 11th February 2021 · 6 mins read
Australia & New Zealand Economics Weekly Monetary policy outlook diverging The New Zealand unemployment rate fell in Q4 and our labour market suite showed an even sharper tightening in the labour market. That’s one reason why we don’t expect the RBNZ to cut rates and why we... 5th February 2021 · 3 mins read
Australia & New Zealand Data Response New Zealand Labour Market (Q4. 2020) The fall in the unemployment rate to 4.9% in New Zealand means the rate is already past the peak and we expect the labour market to continue to tighten throughout 2021. 2nd February 2021 · 2 mins read
Australia & New Zealand Chart Pack Strong labour markets point to tighter policy Underlying inflation picked up strongly in New Zealand in Q4, with core inflation rising above the mid-point of the RBNZ’s 1-3% target band. That supports our view that the RBNZ will not cut rates... 1st February 2021 · 11 mins read
Australia & New Zealand Economics Weekly Underlying inflation on the rise The jump in consumer prices in Q4 largely reflects price hikes for items whose prices are set by the government. Even so, underlying inflation is holding up better than we and the RBA had anticipated... 29th January 2021 · 8 mins read
