This week we have learnt that consumers cut their spending in February but employers strongly raised their on-line job advertising. The NZ dollar lost another cent against a resurgent greenback, but wholesale interest rates have risen to their highest levels since November as growth expectations have risen offshore and pushed up US bond yields in particular. We’ve also received data showing dwelling sales 27% ahead of a year ago and further strength in farm sales. But consumer confidence has weakened and during the December quarter manufacturing output fell 0.7% if one strips out milk and meat processing.
The situation remains one of confusion. However we are still of the belief that growth will accelerate as the year goes by and we see increased spending by farmers, increasing residential construction in Christchurch and Auckland, and improving debt comfort which will slowly bring more consumers and businesses out of their shells.