Video | Agriculture | Confidence | Economy | Energy | Employment | Finance | Media | Property | RBNZ | Science | SOEs | Tax | Technology | Telecoms | Tourism | Transport | Search


BNZ Weekly Overview

BNZ Weekly Overview

The key points of this week's publication include the following.

Tight Labour Market But Low Wage Rises

We present data showing a tight labour market but good business capital spending growth which is increasing productivity vital to moving up the OECD ladder. But why isn't wages growth accelerating? Why are employees not taking advantage of their bargaining power (be they on collective or individual contracts) to seek more money?

And is it possible that our fixation on 1-3% inflation is preventing businesses from raising selling prices given that fewer than 50% cite finding more customers as the main reason they can't sell more product.

Unless we see some price response via accelerating growth in wages, consumer and industrial goods prices to reflect worsening capacity and product shortages then one has to question just how much the free market is really operating in New Zealand.

BNZ EuroStock Funds Returned

We discuss the low return on this product to us investors over the past three years but how by taking exposure to European equities this way rather than in an unhedged non-capital guaranteed fund one is around 43% better off.

US Jobs Data Awaited

In global interest rate and exchange rate markets the focus is all on Friday night's US labour market data for April. If another strong gain near March's 308,000 is reported then the USD will rise, NZD fall, and long term interest rates jump higher. If the result is weak ? say near zero - then the USD will fall, NZD jump up, and long term interest rates decline.

The Weekly Overview is freely available to all BNZ staff, customers, and the public with a centralised EMAIL ONLY distribution list managed here. If you wish to add, change or delete an email address please reply to this message or email Sections of the WO may be reproduced by anyone other than mortgage brokers provided the BNZ is noted as the source.

Best Regards

Tony Alexander Chief Economist Bank of New Zealand

© Scoop Media

Business Headlines | Sci-Tech Headlines


Media Mega Merger: StuffMe Hearing Argues Over Moveable Feast

New Zealand's two largest news publishers are appealing against the Commerce Commission's rejection of the proposal to merge their operations. More>>


Approval: Northern Corridor Decision Released

The approval gives the green light to construction of the last link of Auckland’s Western Ring Route, providing an alternative route from South Auckland to the North Shore. More>>


Crown Accounts: $4.1 Billion Surplus

The New Zealand Government has achieved its third fiscal surplus in a row with the Crown accounts for the year ended 30 June 2017 showing an OBEGAL surplus of $4.1 billion, $2.2 billion stronger than last year, Finance Minister Steven Joyce says. More>>


Mycoplasma Bovis: One New Property Tests Positive

The newly identified property... was already under a Restricted Place notice under the Biosecurity Act. More>>

Accounting Scandal: Suspension Of Fuji Xerox From All-Of-Government Contract

General Manager of New Zealand Government Procurement John Ivil says, “FXNZ has been formally suspended from the Print Technology and Associated Services (PTAS) contract and terminated from the Office Supplies contract.” More>>