BNZ Weekly Overview

Friday, 13 August 2004, 10:16 am
Press Release: Bank of New Zealand

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

Economy Tight As A Drum

New Zealand's unemployment rate is now the second lowest in the OECD at 4.0% and problems for employers finding labour are only going to get worse with strong employment intentions, job advertising, and lengthening order books. The inflationary implications are obvious - especially as consumers appear to be reacting to the strong labour market by increasing their spending at a rapid rate - up 1.5% in the June quarter from 2.2% during the March quarter. Our BNZ.MarketView pick for July is nominal growth of another 0.8%. Floating interest rates are set to rise a lot more than people are comfortably allowing for over the coming year.

NZD Up Slightly

The US jobs data for July were weak and the resulting fall in the USD has caused the NZD to rise one cent to US 65.5 cents. But the positive factors for the NZD are very strong and in the short term there is a strong risk that the NZD heads back to 70 cents - in fact the Reserve Bank may even need this to happen to contain the worsening inflation threat.

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 tony.alexander@bnz.co.nz. Sections of the WO may be reproduced by anyone other than mortgage brokers provided the BNZ is noted as the source.

Bank of New Zealand

Be good with money

Bank of New Zealand (BNZ) has been a big part of New Zealand life for over 150 years since its foundation in 1861. The bank employs over 5,000 people and has more than 170 retail stores and 32 Partners business centres across the country.

Passionate about enabling a higher achieving New Zealand, BNZ works with personal, business, agri, and private wealth clients, helping them grow and make their goals a reality.

A subsidiary of the National Australia Bank Group of companies, BNZ is governed locally by a Board of Directors and strives to help New Zealanders be good with money.

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