December 13 Edition Of The BNZ Weekly Overview

December 13 Edition Of The BNZ Weekly Overview

This will be the last edition of the Weekly Overview for this year. Many thanks to all who have contributed to our monthly Confidence Survey and others who have given emailed feedback over the year. Next year we are contemplating splitting the Weekly Overview into two separate publications - the first looking fairly much like WO issues up to about three weeks ago and the second one focusing on the economies of our major trading partners and what has happened over the week in each one. The second publication will be explicitly focused at New Zealand exporters wanting up-to-date easy to read in laymans terms information on what is happening in our trading partners.

This week the Kiwi dollar has risen in spite of some weakish data on the housing market and retail spending with assistance from our soaring terms of trade, good conditions in the manufacturing sector, and some mild easing of risk aversion overseas.

Events overseas during the week have been extremely interesting with interest-rate cuts in Canada, the United Kingdom and United States being reinforced last night by five major central banks coordinating actions to try and improve financial market liquidity conditions. The story for 2008 will be the same as it has been since the start of August - whether the US economy will enter recession because of the housing market collapse and whether, associated with this, a credit crunch in other major economies will bring global recession. Probably not - one hopes.

See attached file: http://img.scoop.co.nz/media/pdfs/0712/WODec13.pdf

Tony Alexander
Chief Economist
Economics
Bank of New Zealand

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