Local Govt | National News Video | Parliament Headlines | Politics Headlines | Search

 


ASB Cantometer Index





Media Release
ASB Cantometer Index


EMARGOED UNTIL 0100 23 NOVEMBER 2012

ASB Cantometer index reveals encouraging but uneven progress in Canterbury recovery
Decline in housing, employment and consumer spending offset by strong construction activity
Reconstruction activity expected to underpin 18 percent nationwide lift in residential construction over the coming year

A new composite index designed by ASB to track the Canterbury recovery has revealed that aggregate activity in the region is now above pre-earthquake levels and that construction activity in the region will have a significant impact on a national scale in the coming year.

The ‘ASB Cantometer’ is designed as a simple indicator of activity to give some insights into the recovery progress across different categories of economic activity. The study uses a range of publicly available economic data, which is aggregated into a summary measure. The index has been set to zero in June 2010, such that a positive number represents activity being above pre-earthquake levels.

The first edition of the Cantometer reveals that following the 2010 and 2011 earthquakes, activity in Canterbury fell sharply on a broad-based basis, however, a large proportion of this post-earthquake disruption reversed relatively quickly.

ASB Chief Economist Nick Tuffley: “Over the past year, we have seen recovery in most areas of the Canterbury economy. The November Cantometer Snapshot, at 0.2, implies aggregate activity has returned to pre-earthquake levels. Construction is the big driver of the lift in the Cantometer, with the construction index sitting at 2.2. Strong lifts in building consents and demand for ready-mix-concrete have led this increase.”

According to Mr Tuffley, the remaining indices remain below pre-earthquake levels. “However, over recent months we have seen steady improvement in most indices. In particular, the continued recovery in permanent and long-term migration is an encouraging sign of increased population and demand in the region. Canterbury wage growth has also been stronger than the rest of the country – as to be expected. These price developments signal demand is lifting, even if it is yet to be apparent in some activity indicators.”

Outlook

The Cantometer indicates construction activity continues to lift, although the flow on to the remainder of the Canterbury economy remains muted during the early days of the rebuild. “We expect Canterbury reconstruction activity to underpin the nationwide lift in residential construction over the coming year, with nationwide activity rising 18 percent over the year to June 2013,” says Mr Tuffley. “However, we continue to expect the RBNZ to remain focused on global uncertainties and the elevated New Zealand dollar, and leave the OCR unchanged at 2.5 percent until September 2013.”

Chart 1: ASB Cantometer


About the Cantometer

The Cantometer is designed to summarise activity in Canterbury. The study takes a range of publically available regional economic data, which is standardised and aggregated into a summary measure. The index has been rebased to zero in June 2010 (the end of the quarter immediately preceding the first earthquake) such that a positive number represents activity being above pre-earthquake levels.

Along with the aggregate Cantometer index, there are five sub categories: Construction, Housing, Employment, Consumer spending and Miscellaneous. These sub-indices will provide some insight into which sectors are driving the rebuild activity at a given point in time.

For most activity the data reference the level of activity. However, when incorporating wages and house prices into the index we believe levels are less informative. Instead the index uses prices relative to the rest of the country. An increase in relative prices is a signal for resources to be reallocated to the Canterbury region.

The historical Cantometer series represented on the charts is a simple average of the complete set of data for each month.

The miscellaneous category includes electricity, car registrations, guest nights and permanent and long-term net migration. A common factor driving these areas will be population growth, and we expect all these indicators to increase as the rebuild gathers momentum.

ENDS

© Scoop Media

 
 
 
 
 
Parliament Headlines | Politics Headlines | Regional Headlines

Gordon Campbell:
On The Team Behind Trump's Throne

Forget the Putin factor. Daily, the team of charlatans, bigots and stunningly ignorant crackpots that Trump is appointing to head key federal agencies is just as alarming. These are positions with vast power and budgetary discretion over policies that stand to affect tens of millions of vulnerable Americans. Sad! More>>

 

Gordon Campbell: On Bill English, Abroad

If David Cameron was the closest thing John Key had to a political mentor, their successors also share a whole lot in common. Theresa May and Bill English were both propelled into the top jobs as the result of unexpected resignations, and without much in the way of credible competition from their colleagues... More>>

ALSO:

Pike River: Labour Bill To Override Safety Act For Mine Entry

“Bill English has been hiding behind the legal excuse that any attempt to re-enter the mine to recover the bodies might place the mine’s owner, Solid Energy Limited, and its directors in breach of the Health and Safety at Work Act 2015." More>>

ALSO:

Gordon Campbell: On Populism And Labour 2017

For many people on the centre-left, populism is a dirty word, and a shorthand for the politics of bigotry. In this country, it has tended to be equated with the angry legions of New Zealand First. Who knew they were not just a reactionary spasm, but the wave of the future? More>>

Oxfam: 30% Of NZ Owns Less Wealth Than Our Two Richest Men

The research also reveals that the richest one per cent have 20 per cent of the wealth in New Zealand, while 90 per cent of the population owns less than half of the nation’s wealth. The research forms part of a global report released to coincide with this week’s annual meeting of political and business leaders at the World Economic Forum in Davos, Switzerland. More>>

ALSO:

Hospitals: Resident Doctors Set To Strike Again

Despite discussions between the DHBs and NZRDA over safer hours for resident doctors progressing during the last week, the strike planned for next week appears set to proceed. More>>

ALSO:

Not So Super Fund: More Burning Ethical Questions For Steven Joyce

Greens: Radio New Zealand reported this morning that the New Zealand Superfund has $77 million invested in 47 coal companies that the Norwegian Government’s Pension Fund – the largest sovereign fund in the world – has blacklisted. More>>

Activism: Greenpeace Intercepts World’s Biggest Seismic Oil Ship

Greenpeace crew have made contact with the world’s biggest seismic oil ship after travelling 50 nautical miles on two rigid-hulled inflatables off the coast of Wairarapa... Greenpeace radioed the master of the Amazon Warrior to deliver an open letter of protest signed by over 60,000 New Zealanders. More>>

ALSO:

Gordon Campbell: Why Tax Cuts In 2017 Would Be A (Proven) Bad Idea

Ever since the world fell prey to the mullahs of the free market in the 1980s, no amount of real world evidence has managed dispel one key tenet of their economic faith. Namely, the idea that if you cut income taxes and taxes on small business, a wave of individual enterprise and entrepreneurial energy will thus be unleashed, profits will rise and – hey bingo! – the tax cuts will soon be paying for themselves ... More>>

Get More From Scoop

 

LATEST HEADLINES

 
 
 
 
 
 
 
 
Regional
Search Scoop  
 
 
Powered by Vodafone
NZ independent news