New Zealand Economy

6

RBNZ threatens currency intervention

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,

6

RBNZ hikes, gets hawkish

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

19

RBNZ slams the population ponzi

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

14

NZ Treasury weary of high immigration

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,

39

Greenies are to blame for high house prices

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,

25

NZ’s English ramps-up housing supply-side attack

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

18

NZ leaders put OZ elites to shame on housing

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

11

RBNZ smashes high LVR mortgage lending

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,

8

NZ home ownership rate slumps

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,

7

S&P warns on New Zealand housing

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

14

RBNZ smashes high LVR mortgage lending

By Leith van Onselen Following on from yesterday’s post showing the ongoing contraction in overall housing finance commitments in New Zealand following the implementation of speed limits on high loan-to-value ratio (LVR) mortgage lending by the Reserve Bank of New Zealand (RBNZ), the RBNZ has just released new data showing a dramatic fall in the

10

NZ mortgage demand continues to soften

By Leith van Onselen The Reserve Bank of New Zealand’s (RBNZ) latest mortgage approval data continues to point to an ongoing weakening of mortgage demand, suggesting that the RBNZ’s speed limits on high loan-to-value ratio (LVR) mortgage lending, introduced on 1 October 2013, are having their desired effect and working to cool the New Zealand

6

Yes, the RBNZ’s mortgage caps are working

By Leith van Onselen Fairfax’s Max Mason has written a piece today in The SMH arguing that the Reserve Bank of New Zealand’s (RBNZ) speed limits on high loan-to-value ratio (LVR) mortgage lending, implemented on 1 October 2013, are failing to cool New Zealand house prices: Tighter lending restrictions imposed by New Zealand’s central bank

7

LVR caps put the clamp on NZ house prices

By Leith van Onselen The Real Estate Institute of New Zealand (REINZ) has released its December house price results, which registered a significant fall in quality-adjusted values nationally, with prices also down across two of the three biggest markets. In the month of December, the national stratified median price fell by 1.0% to just over

9

Kiwi growth leaves Oz in the dust, eh

From Interest.co.nz: Gross Domestic Product  rose 1.4% in the September quarter on the back of the largest expansion in the agricultural sector in 25 years, according to Statistics New Zealand. The extremely strong result, on the back of a rebounding dairy market following drought earlier this year, is stronger than the average expectation of economists

7

Kiwis live in Middle Earth on Pandora

Here’s an interesting tidbit: The next three Avatar films will be made in New Zealand, the Prime Minister has announced at a press conference with the film’s director James Cameron. Mr Key announced this morning that the Government had signed a memorandum of understanding with the film’s makers to secure the multi-film deal. He said