Tony Alexander

Economic Commentaries

Europe Down, NZ Housing Up

Thursday July 12th 2012

This week we have seen worries about Europe grow again and that has meant falls in NZ wholesale borrowing costs and some mild weakness in the NZD – except against the increasingly beleaguered Euro. On the data front our BNZ Confidence Survey recorded a small rise in sentiment, our BNZ-REINZ Residential Market Survey found a decline in people potentially wanting to sell their property and further increases in buyer interest, while the NZIER’s quarterly survey showed quite a decline in inflationary pressures.

It adds up to NZ interest rates staying low for a long time, investors seeking yield in areas like housing and corporate bonds, but the NZD staying volatile though well supported as opinion about Europe chops and changes in an unpredictable manner though around a deteriorating trend in European sentiment.