By Leith van Onselen The Reserve Bank of New Zealand (RBNZ) has once again hiked the official cash rate (OCR) by 0.25% to 3.50% – the fourth rise in five months – but also signaled a pause while it assesses the impact on the New Zealand economy. The RBNZ has also warned on the New
By Leith van Onselen Yesterday, Statistics New Zealand released its permanent & long-term migration figures, which revealed that New Zealand net migration is booming and Kiwis are returning home from Australia: In the June 2014 year, permanent and long-term (PLT) migrant arrivals numbered 100,800 (up 14 percent from 2013), the first time more than 100,000
By Leith van Onselen The Real Estate Institute of New Zealand (REINZ) has released its June house price results, which registered a second consecutive monthly fall in values, as well as a significant slowing in annual growth. In the month of June, the national stratified median price fell by 0.3% to around $441,000. Prices fell
By Leith van Onselen Last week, Statistics New Zealand released the national accounts for the March quarter, which revealed that real GDP in New Zealand rose by a strong 1.0% over the quarter to be up 3.3% over the year. The headline result was slightly weaker than Australia’s, where real GDP increased by 1.1% over
by Chris Becker NZ just printed its current account deficit (CAD) for the March quarter, which fell by almost half from the last quarter, all on the back of agricultural exports. It is still elevated as measured by a percentage of GDP – some 2.8% although this is down from 3.9% in the previous 12
by Chris Becker Following the rise in the official cash rate in New Zealand yesterday, the RBNZ has come out again in talking its currency down, focusing on falling commodity prices not just the interest rate differential with the other major currencies. From Bloomberg: The Reserve Bank of New Zealand believes currency traders are mispricing
by Chris Becker As reported earlier in Macro Morning, the Reserve Bank of New Zealand (RBNZ) has hiked its official cash rate 0.25% to 3.25%: The main reasons indicated are house price inflation and very decent GDP prints (mainly due to reconstruction in Christchurch, not necessarily an indicator of a strong underlying economy) Sound familiar?
By Leith van Onselen New Zealand Prime Minister, John Key, has lept to the defence of New Zealand’s high immigration intake, refusing to concede that it has placed upward pressure on house prices or interest rates. From Interest.co.nz: Key denied the current rise in migration was responsible for higher interest rates. “No, I don’t think
By Leith van Onselen The New Zealand Institute of Economic Research (NZIER) has today released its Quarterly Predictions report, which sees dangers ahead for the New Zealand economy on account of the slowing housing market: The New Zealand economy has been recovering from the recession. But slumping house sales are a significant risk to our
By Leith van Onselen While the Australian Prudential Regulatory Authority (APRA) continues to act concerned over the re-emergence of risky lending, and has released a draft Prudential Practice Guide 223 Residential Mortgage Lending, its counterpart across the pond, the Reserve Bank of New Zealand (RBNZ), continues to enjoy success from its cap on high loan-to-value
By Leith van Onselen New Zealand’s housing market is showing further signs of slowing, with the Reserve Bank of New Zealand’s (RBNZ) latest survey of households showing the lowest percentage of people expecting house price gains since 2012. From Interest.co.nz: …in the past three months the net percentage of people expecting house price gains in
By Leith van Onselen After making good progress on housing policy, New Zealand’s Prime Minister, John Key, has taken the retrograde step of claiming that housing affordability is not that big a problem after all. From Interest.co.nz: Prime Minister John Key has rejected suggestions that housing is much less affordable for first home buyers in
By Leith van Onselen The marvelous Reserve Bank of New Zealand (RBNZ) has released its bi-annual Financial Stability Report, which in true RBNZ fashion contains some blunt assessments about risks facing the New Zealand financial system and broader economy. While acknowledging that the financial system is currently sound, the RBNZ remains concerned about New Zealand’s
By Leith van Onselen The Real Estate Institute of New Zealand (REINZ) has released its April house price results, which registered a modest increase in values nationally, with prices also hitting a new record. In the month of April, the national stratified median price rose by 0.1% to $447,500. Prices rose by 2.0% in Auckland
By Leith van Onselen While Australia’s Reserve Bank has taken a back seat, and let the Australian dollar run, the Reserve Bank of Australia (RBNZ) has today warned markets that it could intervene and sell NZ dollars if the currency remains high. Speaking at the DairyNZ conference in Hamilton this morning, RBNZ governor, Graeme Wheeler,
By Leith van Onselen The Reserve Bank of New Zealand (RBNZ) has once again hiked the official cash rate (OCR) by 0.25% to 3.00% on the back of growing strength in the New Zealand economy. From the Statement: New Zealand’s economic expansion has considerable momentum, with GDP estimated to have grown by 3.5 percent in
By Leith van Onselen The Reserve Bank of New Zealand’s (RBNZ) Michael Reddell has written an interesting paper questioning the merits of New Zealand’s high immigration program, which appears to have crowded-out (through higher interest rates and a high average real exchange rate) other productive investment, lowering living standards in the process: Over the last
By Leith van Onselen New Zealand’s Housing Minister, Nick Smith, has set an ambitious target to improve the affordability of New Zealand housing back to its long-run average of four times household incomes. From Interest.co.nz: “The target that I’ve given to my ministry goes back to those long term affordability measures – which is the
By Leith van Onselen The Real Estate Institute of New Zealand (REINZ) has released its March house price results, which registered a significant bounce in values nationally, with prices also hitting a new record. In the month of March, the national stratified median price rose by 3.4% to nearly $427,000. Prices rose by 0.4% in
By Leith van Onselen The New Zealand Treasury has released a new research paper questioning the merits of high immigration, and recommending a reduced immigration intake in the event that the economy is unable to adequately cope with population pressures: Reviewing the literature, the balance of evidence suggests that while past immigration has, at times,
By Leith van Onselen The Reserve Bank of New Zealand (RBNZ) has released its quarterly bulletin, which contains a frank assessment of its macroprudential caps on high loan-to-value ratio (LVR) mortgage lending. Its conclusion? That the LVR caps have probably reduced New Zealand house prices by around 2.5%: It will be some months before the
By Leith van Onselen After last month taking the fight to Auckland’s entrenched anti-sprawl “NIMBYs” (Not In My Backyard) and “BANANAs” (Build Absolutely Nothing Anywhere Near Anyone) groups in a speech at an Auckland Chamber of Commerce and Massey University luncheon, and earlier this month attacking town planners for restricting the growth of housing supply,
By Leith van Onselen Statistics New Zealand has released the results from the 2013 Census, which revealed a fall in the country’s home ownership rate by individuals (see below chart). According to Statistics New Zealand, only 49.8% of people aged 15 years and over owned or partly owned the home they lived in, compared with
By Leith van Onselen The Reserve Bank of New Zealand (RBNZ) has for the first time in nearly three years hiked the official cash rate by 0.25% to 2.75% on the back of growing strength in the New Zealand economy. The RBNZ has also raised its forward guidance on rate hikes, forecasting 1.25% of hikes
By Leith van Onselen After last week taking the fight to Auckland’s entrenched anti-sprawl “NIMBYs” (Not In My Backyard) and “BANANAs” (Build Absolutely Nothing Anywhere Near Anyone) groups in a speech at an Auckland Chamber of Commerce and Massey University luncheon, New Zealand’s Deputy Prime Minister and Finance Minister, Bill English, has today attacked town
By Leith van Onselen New Zealand continues to leave Australia for dead when it comes to housing policy. Unlike the Reserve Bank of Australia (RBA) and the Australian Prudential Regulatory Authority (APRA), which continue to hose down concerns about risks building in the Australian housing market, New Zealand’s central bank and prudential regulator, the Reserve
By Leith van Onselen The Reserve Bank of New Zealand’s (RBNZ) macroprudential caps on high loan-to-value ratio (LVR) mortgage lending, introduced in October last year, continue to work their magic, with the share of 80%-plus LVR mortgages issued by New Zealand’s banks registering another fall (see next table). According to Interest.co.nz: As of October 1,
By Leith van Onselen Statistics New Zealand last week released the results from the 2013 Census, which revealed another fall in the country’s home ownership rate (see below chart). According to the Census, the share of New Zealand households owning or paying-off a home fell to 64.8% in 2013, from 66.9% at the 2006 Census,
By Leith van Onselen The Real Estate Institute of New Zealand (REINZ) has released its January house price results, which registered another significant fall in values nationally, with prices also down across all of the major markets. In the month of January, the national stratified median price fell by 2.3% to just over $423,000. Prices
By Leith van Onselen Ratings agency, Standard & Poors (S&P), has again warned that New Zealand’s housing market is vulnerable to a sharp correction, especially if there is an external economic shock. While S&P does not expect a big increase in credit losses, it does “consider the stand-alone credit profiles of all banks and credit
