This week’s Overview runs to just under 8 pages. We start by discussing National Farm Fieldays and the topic of this year’s 11.00am and 2.00pm talks to farmers in the BNZ tent – the new world of credit rationing in New Zealand. We then discuss the Reserve Bank’s recent paper seeking consultation on a debt to income ratio tool – it will probably be eventually introduced but government are unlikely to be in a hurry to do so as the immediate impact will sap growth by up to 0.5% in the Reserve Bank’s estimation.
We then take a look at Labour’s new migration policy aimed at curtailing the boom in low skilled migrant doing low skill courses as a route to NZ residency while skilled migrants having to make 160 points are effectively shut out. Then its a quick comment about how people ignore data which do not agree with their entrenched view.
After that we write about movements in wholesale swap rates for the first time in ages. Why? Because they have fallen quite a bit. Some fixed interest rates might edge lower soon. And we finish by discussing the completely unsurprising rebound in the NZ dollar and how the fundamentals strongly support strength if not further gains going forward – including the highest terms of trade since 1973. Enjoy.