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US jobs & real estate markets firm; India gripped by Adani corruption case; South Africa cuts rate; S&P500 up on Gaetz withdrawal; UST 10yr at 4.42%; gold firm again but oil still on hold; NZ$1 = 58.6 USc; TWI = 68.3

Economy / news
US jobs & real estate markets firm; India gripped by Adani corruption case; South Africa cuts rate; S&P500 up on Gaetz withdrawal; UST 10yr at 4.42%; gold firm again but oil still on hold; NZ$1 = 58.6 USc; TWI = 68.3

Here's our summary of key economic events overnight that affect New Zealand with news about separate corruption cases involving Gautam Adani, and Matt Gaetz.

But first today, the US labour market is maintaining its strength, despite strikes and tropical hurricanes. Last week only +213,000 people filed for initial jobless claims, well below the prior week, below what seasonal factors would have brought, and below the same week last year. This was a seven month low. Continuing claims inched up the prior week to 1.67 mln but that was about the same level as last year.

Those job gains are helping their housing market. Existing home sales rose in October by +3.5% from the previous month to an annualised rate of just under 4 mln. While this level is pretty tame for them, it is off the September low which had the distinction of being a q14 year low. Industry insiders are hoping October's rise signals a trend turnaround. But it is hard to see with mass layoffs in the US Federal workforce imminent, it might be a vain hope.

In contrast to the big jump in the New York region, the Philly Fed's factory survey dipped in November, but new order levels remained positive, and sentiment ahead did too. It was similar in the same report by the Kansas City Fed, where firms expect increases in production, new orders, and employment in the next six months.

In Canada, producer prices turned up in October after easing in the prior month, to continue a trend that started in April. But the rises are not inflationary.

In India, the depth and pervasiveness of corruption is on display in a case that is gripping the country. The BSE fell -0.5% on the news. And PM Modi is annoyed by the revelations as Adani has been important in his rise. In New York, Indian billionaire Gautam Adani was indicted on bribery charges in a US federal court yesterday, with prosecutors alleging the 62-year-old tycoon and other Indian executives promised more than US$250 mln to Indian government officials to win contracts. Bribery is also at the heart of a Swiss case against the same people. And Indian steel makers have faced similar allegations. But given the pervasiveness of corruption in India at the top level, there is probably little that will change there especially as the BJP controls their government. The Americans are prosecuting because Adani did not disclose the bribes in documentation for fundraising in US markets, and it was considered to be a material factor for the investments.

Ending a long series of improvement, the EU consumer sentiment survey reported a fall to a more negative result in November. Despite this, data out for EU car sales was quite positive, putting the August and September sag behind it and returning to levels that have been 'normal' since mid-2022.

In Turkey, they reviewed their policy rate and held it at 50%. Turkey has inflation running at 48%. In South Africa, they also reviewed theirs and cut it by -25 bps to 7.75%. South Africa has inflation running at 2.8% and falling quickly now. It is back within its target range.

Container shipping freight rates were little-changed last week. Bulk cargo rates spiked during the week, but ended up basically unchanged from last week.

The UST 10yr yield is now at just on 4.42% and up +1 bp from yesterday at this time. The key 2-10 yield curve is still positive by +10 bps. Their 1-5 curve inversion is now inverted, by -10 bps. And their 3 mth-10yr curve inversion is also still inverted, now by -16 bps. The Australian 10 year bond yield starts today at 4.62% and down -2 bps. The China 10 year bond rate is down -2 bps at 2.08%. The NZ Government 10 year bond rate is up +3 bps from this time yesterday at 4.72%.

Wall Street started its Thursday little-changed, but then rose +0.7% on the S&P500 and rising when Matt Gaetz said he won't be the US Attorney General. European markets were up about about +0.8% except Paris which rose only +0.3%. Tokyo ended its Thursday session down -0.9%. Hong Kong ended down -0.5% while Shanghai was up +0.1%. Singapore was down -0.1%. The ASX200 ended little-changed and the NZX50 ended with a minor +0.2% rise.

The price of gold will start today at US$2649/oz and up another +US$26 from this time yesterday.

China has found new gold reserves in central Hunan province, state outlet Xinhua News reported yesterday. China is the world's largest gold producer, accounting for around 10% of global output.

Oil prices are again little-changed, up just +50 USc to just over US$69.50/bbl in the US while the international Brent price is now just over US$73.50/bbl.

The Kiwi dollar starts today at 58.6 USc and down -10 bps from this time yesterday. Against the Aussie we are -40 bps lower at 90 AUc. Against the euro we unchanged at 55.8 euro cents. That all means our TWI-5 starts today at just over 68.3, and down -20 bps from yesterday.

The bitcoin price starts today at US$97,247 and up +3.7% from this time yesterday. Volatility over the past 24 hours has been moderate at +/- 2.7%.

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103 Comments

The Trump team circus couldn't even wait until he was president this time! So funny. 

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Would suggest business as usual has simply resumed. Inconsistency, confusion and chaos has already been proven as a great smokescreen.  This nomination though was a mission. This was going to be Raguel with a 99.9%  portfolio loading concentrating on vengeance.

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America - just a badly programmed video game. 

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The US knocking corruption is a bit of a joke. CIA and the Shah of Iran, anyone? 

This link of for the Chrisonn's and jfoes here, worth everyone reading carefully:

https://surplusenergyeconomics.wordpress.com/  (latest post). That answers the 'economics knows what it is measuring' assertion - it doesn't. 

That is the background to the geopolitical dance we are watching - like Netanyahu being essentially denied a European visit. The US is looking more and more like a failed state/declining hegemony. Interesting times...

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Read Thomas Fleming “Duel” in which the author recounts Hamilton’s lament that corruption had  been sewn into the very fabric of the constitution. 

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The military/industrial complex, and the Israeli and Ukranian leaderships, are panicked and cramming as much as they can into the dying Biden calendar. Tells us a lot about the reality of what his era represented - somewhat at odds with the projected narrative. 

https://seymourhersh.substack.com/g/force-evacuation-and-smash-the-camps

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Paywalled PDK. I also note you have promoted Seymour Hersh before.

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Promoted? 

Interesting description of one of the better journalists of our age. Sounds like a US-inclined military bias...  

:)

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Are you that sensitive? Biased? Not at all. I've read a few of his articles put forward by yourself and others in the past and have been entirely open minded to what he says. Doesn't mean I accept it hands down though. He's after all just a single source, but i would place more credibility on him than many others. Just because his name is attached doesn't make him right, or wrong. I don't know enough about him. What drums does he beat? I recall David Lange could present a very good coherent argument even citing evidence, but it turned out he was rabidly anti-American. So forgive me for having a little scepticism.

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History is an easy and likely the best way to measure people and nations, but the CIA and Shahs interactions were how many years ago? Is the US like that now? would the US Justice Department and FBI let them get away with it? Adani's corruption trial is pissing off India (I was surprised to read how rife corruption is in India). What is the US stance towards the ICCs arrest warrant for Netanyahu? Is a signal being sent out about corruption? How will Trump take it? There appears to be a fair amount of contradictions in this space.

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Look at the rhetoric about Iran NOW. Half the developed world has decided they're evil. (Sure, their culture and values aren't ours, but given our colonialist histories, that is a moot reference-point). 

I'd say the US probably peaked its thuggery in the Reagan-to-Bush Junior years - but it is still a thug. And yes, they allow themselves to 'get away with it'; that's a TINA.

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I suggest the independent media reports about Iran tend to back that up. Let's face it what does history tell us about theocratic regimes led by fundamentalist nutters? They believe they speak for god (if the were RC they'd probably think they were god!) and are therefore allowed tom do anything in his name with no accounting. Their actions speak for themselves. Evil comes pretty close.

Some blinkers being exposed there PDK. I'm not saying they're innocent, but it is often dictated you have to make some pretty harsh choices when facing down a culture that would destroy you. That argument works both ways but which side would you want to win? We're too small to have much of a say if any, but the outcomes would impact us big time.

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They believe they speak for god (if the were RC they'd probably think they were god!) and are therefore allowed tom do anything in his name with no accounting. Their actions speak for themselves. Evil comes pretty close.

Israel comes to mind

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You need to keep the big picture in mind - and introducing 'that would destroy you'  - isn't doing that. 

They had a right to self-determine, and weren't about to destroy us - until Britain drew crude crayon lines on a map, and called them countries. Why did it do that? Because, from William Knox DÁrcy onwards, the west has wanted - then needed - the oil underneath them. 

Who destroyed whom? Did Iraq invade the US twice? For it's democracy, of course, not for its oil...

Perspective...

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Is self determination including a theocratic, Islamic fundamentalist group seizing power by force and then claiming legitimacy 'self determination'? Do the people of Iran have a real right to determine perhaps a secular government? 

To all intents they are a Shia agitator in the ME stirring up all kinds of unrest. They may not have posed a direct threat to the US, but it is pretty clear they do to their neighbours, and thus indirectly to world order.

Big picture; the Shah's regime was not necessarily a squeaky clean one, but he was transforming their society into a modern free one increasing rights and privileges across the board. He was facing some significant fundamentalist Islamic opposition to those changes and ultimately Khomeini was able to garner sufficient support to topple his government. It takes time, some times generations to change societies towards the better against resistance and those who would lose their power and influence. You need to understand your big picture a little better i think.

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Those crayon marks are not much older than 100 years yet they have inflicted more distortion and upheaval in the Middle East than anything since the Crusades. It imposed unnatural boundaries on historically nomadic land in which the people had had century on century of sorting it out for themselves by tried and proven traditions. The  Iraqi invasion of Kuwait was basically an attempt to rub one of the lines out. WW1 ushered in the age of oil and alongside, mechanised warfare. As Lord Curzon accurately declared post WW1 - we sailed to victory on a sea of oil. It really has been an increasing cauldron of trouble ever since hasn’t it.

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"I'd say the US probably peaked its thuggery in the Reagan-to-Bush Junior years"

The US at an all time high in "thuggery" and is not close to peaking. They are openly supplying the bombs and vetoing UN resolutions for the Israeli genocide*. I guess the Middle east has organised to limit the effectiveness some of the US thuggery but the activity is there. They no longer have a weapons advantage but this has only made them more aggressive and I guess they are using vassals rather than their own military but that hardly makes a moral difference.

*After recent UN developments, I no longer think this statement needs any defending and can just be asserted

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I know I said I was not going to defend it but I did not know about this development:

[The ICC, the] Netherlands-based court said it found "reasonable grounds" to believe that Netanyahu bears criminal responsibility for war crimes including "starvation as a method of warfare" and "the crimes against humanity of murder, persecution, and other inhumane acts."
https://www.rnz.co.nz/news/world/534475/international-criminal-court-is…

It's a genocide and should be talked about as such. We are just waiting for the ICJ to make it beyond official.

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I don't accept that it's genocide at all. They are not trying to wipe out all Palestinians. They are trying to obliterate Hamas in all it's iterations, because they attacked Israel, while hiding behind their own civilians. Has Israel committed war crimes as defined by international law? I believe so, and I think the warrant is justified. Hamas is as guilty of crimes as Israel but why don't we hear an outcry against Hamas? 

People are calling for a cease fire, but when you ask them about it they want Israel to stop shooting and bombing, but don't really care about Hamas. They wilfully disregard Hamas' actions, while condemning Israel. Is Israel not allowed to defend itself?

Don't get me wrong, I have stated in the past that to all intents Israel is effectively the Nazis of the middle east, doing to the Palestinians what was done to them when their land was stolen. But unlike the the Nazis the Israel has not created a program to systematically wipe all Palestinians off the face of the earth. What they are doing is attacking Hamas where ever they are, and if they hide behind Palestinian civilians, then that is Hamas' choosing. Why aren't you blaming Hamas?

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Genocide

The deliberate killing of a large number of people from a particular nation or ethnic group with the aim of destroying that nation or group.

What part of the above do you not understand Murray?

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Does the definition of Hamas fit the bill for the legal definition of "group" as you've stated it? I suggest not, or do you consider all Palestinians as members of Hamas? They are instead a legally recognised terrorist organisation which perpetrated an attack on Israeli citizens. They have done this repeatedly, but the October 7 attack was mostly against the youth of Israel. Something that was bound to garner an extreme response.  

Hamas hides behind their own people. How is Israel supposed to defend itself?

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If Hamas were hiding in Israel (which they probably are) would you be ok with the same level of violence being inflicted there?

Do Palestinians have a right to defend themselves against occupation....I guess not in your narrow view? 

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Please do not presume to know what i think.

If Hamas were hiding in Israel I suspect the Israelis would be just as brutal flushing them out, but I seriously doubt they would be sheltered by Jews. Israel was not occupying Gaza. I know some now claim they were, but that is a lie. Do Palestinians have the right to defend themselves, absolutely they do, See my other post about Israel being 'Nazis'. But the strikes on Gaza are the result of an Hamas attack on them, not the other way around. How many rocket attacks were there originating from Gaza, against Israel before October 7 and what was Israel's response to those?

Do not forget that Israel is warning the civilian population of Gaza and now Lebanon of where and when they are going to strike. They are doing by leaflets and phone messages. Is that the act of a country committing genocide? Ask yourself why the civilian population is not leaving when they are being told what is coming. Why aren't they leaving? Who is stopping them? 

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Hamas and other groups have openly asserted their intention that Israel and its people are to be destroyed. That in itself is in turn a threat of genocide which obviously from an Israeli point of view requires it to conduct its defence however it can with whatever its got. Israel has a nuclear arsenal and the recent bellicose  utterances out of Russia and China about the justified and legitimate use of a nuclear strike, for example in the face of a perceived existential threat, has provided Israel, probably unintentionally, a rather uncomfortable precedent for those issuing and supporting the activities that threaten Israel.

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You are using a double standard for your genocide justification. Or, do you take a different stance on Cambodia, Rwanda and others?

To alleviate your ignorance on the topic:

https://en.wikipedia.org/wiki/Legality_of_the_Israeli_occupation_of_Pal…
https://en.wikipedia.org/wiki/Status_of_territories_occupied_by_Israel_…

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I am not justifying genocide by any party. My post is purely my take on the present playing field, the players, the playing conditions and the play itself. Chambers viz, Genocide - “the deliberate extermination of a racial, national, religious or ethnic group.” Cannot see how the threats of Hamas and like associates against Israel,  escape that as being of genocidal  intent. That on its own, simply speaks for itself regardless of any other examples, past, present or future.

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Oh, but precedent is important because genocidal states morally and in a simplistic sense legally lose their right to exist in their current form. (I don't think Hamas cares if it's dissolved at the same time as the Israel government.) Once it can be determined there is moral obligation to stop it and the UN is meant to act.

Letting a genocide continue (or ignoring one) because you perceive genocidal intent from the other side is not how this works. There is extensive precedent for neighbouring states (and in recent times the UN) to intervene. Ignoring or minimising a genocide because your opinion of the other side is genocide justification.

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Yes that ability to resolve conflict and prevent bloodshed certainly was in the minds of those that formed the United Nations but sadly it has too often been ineffectual. In fact the UN forces intervention soon after in the Korean peninsula actually could be said to have caused too much of such result. At the present time the UN is proving to utterly powerless in Palestine and The Ukraine, hardly a unique position for them either but nonetheless a hard reality.  I feel you are trying to attach too much of a side to my comment(s.) All I am offering here is my personal interpretation of what has happened and why, and is still happening as I often submit similarly on the conflict  in Ukraine

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((Yes, I was inferring your opinion. So, you agree with me that it is both a genocide and UN and ICC has provided sufficient evidence that it is one in the last week or so.

Why did you make the off topic post then? I still feel your trying to argue something on this topic, such as we should just carry on as normal and that this is moral.)) not blanking this but i take it back

 

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Again your first paragraph is loaded with inference. None of my comment has sought  to either quantify or justify any genocide by any party. Your second paragraph again is astray. My initial post was submitted as a qualification of that of murray’s earlier, and only with the intent which I have already explained.

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My apologies I did indeed misplace the comment indent.

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FG. Yes, the word genocide has become degraded by its ill informed application. Whatever one thinks of Israels military strategy and tactics, it has never set out to destroy a neighbouring nation nor whole people group as the meaning of the word requires.         

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" it has never set out to destroy a neighbouring nation nor whole people group"

This statement is stunningly ignorant.
Even a cursory glance at any video footage you choose taken inside Gaza shows the level of devastation being inflicted. 

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The civilian vs militant kill ratio in Gaza is the lowest by a significant margin of any modern conflict in built up areas.     

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What a repulsive lie. You should be ashamed of yourself.

 https://www.oxfam.org/en/press-releases/more-women-and-children-killed-…

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Yes, agree its a sickening overall death rate but my point is about ratio not totals. And in comparable closely built up areas such as Aleppo. There's considerable analysis available on this particular aspect from more objective sources than politicised Oxfam.       

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Its not genocide its war. The Palestinians are stupid, you could see this coming the second they jumped the fence and started shooting and abducting people, I have zero sympathy for what's happening now. They are double stupid in that they were not existing without massive amounts of aide and that's before October 6th, did they seriously expect that the hundreds of trucks a day would keep on rolling in that countries like the USA were paying for ? I said they would get smashed a year ago and that's exactly what is happening.

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Such an attack is certainly an act of war and surprise attacks are hardly unknown as to is the reaction and repercussions. In the case of Gleiwitz 1939,  Barbarossa and Pearl Harbour 1941, the resultant devastation is well documented. Others such as Pt Arthur 1904 not so much. Would be of interest to discover what Hamas had contemplated in their particular case.

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FG. A reasonable inference from the years of Hamas digging of tunnels under Gazan population centres indicates they knew and contemplated exactly what has occurred, ie a short brutal bloodletting in Israel followed by a prolonged siege that resulted in enough death and suffering of a civilian population denied access to the tunnel shelters, to reshape world opinion. The billionaire Hamas leaders living luxuriously in distant Qatar cynically set out to sacrifice their people.       

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Tunnels that were dug during the previous siege of Gaza you mean?

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The hundreds of kilometres of tunnels were dug over decades. 

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Correct, decades of Siege

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Not in the accepted military sense of the word but yes, Egypt & Israel maintain a tight blockade on Gaza. 

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Zwifter. Zero sympathy? Really?. The horrors being suffered by Gazan non militants in the war zones are appalling. Many are ignorant deeply brainwashed people who had no say on the invasion of southern Israel and who even now have limited understanding of the extent of the vile atrocities perpetuated by Hamas operatives on Oct 7.  

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Murray, if you want to be a genocide apologist or justifier that's your choice. You are being wilfully ignorant of recent developments.

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Utter BS Tim. You are the one who has become emotionally wrapped in the hysterical reporting by interest groups. Read my earlier posts to see how I view this. If there is anything incorrect about them tell me, and provide the evidence. Try seeking out a balanced view before you start throwing stones. 

Consider who attacked who in the first place? I'll give you a clue this started October 7 2023.

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Don't argue with me about your stance, go argue with UN, ICC and ICJ. There is a "Committee report" published on 19 November 2024 that you can start with.

I have I ready said I no longer feel any need to defend mine, we crossed that point today with the ICC. You are justifying a (UN defined) genocide Murray.

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Hear Hear

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The ICC is not the UN, but the UN Racconteur says there are reasonable grounds genocide is being committed, but then goes on to define genocide as "genocide is defined as a specific set of acts committed with the intent to destroy, in whole or in part, a national, ethnic, racial or religious group. " Which one of those groups does Hamas belong to? I suggest none of them. Legally they have been previously defined and identified as a terrorist group. That they have assumed control of Gaza and hide behind Palestinian civilians is just another tactic in their war against Israel. And they are the ones who declared war on Israel, not the other way around. What would you have happen? For the bombing and shooting to stop, Hamas must stop shooting rifles and missiles at Israel, and otherwise attacking them, and release any and all hostages. Until that happens Israel can claim with some justification that they are only defending themselves. Do I agree with what they are doing? No. I think they are going way over the top but this is not about Israel stopping it is about Hamas stopping, and how do you make that happen? Israel did not start this, Hamas did. In all this discussion you have conveniently not responded about a response to Hamas. Why not?

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Doesn't matter that you don't accept it Murray - it's still a genocide. 

And a result of forced apartheid.

In cases like this, propaganda has a short clock; starts when it sounds best for its case. 

 

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Rubbish PDK you are undermining your own credibility here. If genocide is to be applied it is Hamas doing it to it's own people wilfully because they knew what Israel's response would be when they attacked.

You have claimed in this thread you like the 'big picture'. Look at the recent history of Palestinian refugees. They are no longer welcome in neighbouring Arab countries. Why?

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Your an idiot Murray/Middleman

Arrest warrant by ICC for Netanyahu, Yoav Gallant

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Those predictable arrest warrants add little to the debate on whether Israel is a genocidal state.   

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Face Palm

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Murray. While the terrorist Hamas creed definitely is genocidal in respect of Israel, its cynical sacrificing of the Gazan people in pursuit of its PR strategy still doesn't meet the definition of genocide. 

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I didn't say Hamas was guilty of genocide of the Palestinians. II pointed out that they were the ones hiding behind Palestinian civilians. But in this discussion none of you have identified a solution to dealing with Hamas. Israel stopping is not a solution and will never end it, but would justify Hamas' tactics.

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It is not difficult to conclude there is no solution, in the foreseeable future at least. The Israelis themselves the Irguns in the 1930s were  the equivalent of Hamas today. Centuries of embedded interracial and religious hatred is hardly easy to quell and settle. For instance last century and still combustible, Northern Ireland and Yugoslavia once the lid was lifted. Some Arabic nations, Egypt, Jordan appear to have acknowledged that Israel as a state has come to stay but Palestine is of the land thus occupied and how exactly do you appease the Palestinians over that.

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If it is a genocide in Gaza then Israel is doing a terrible job at commiting genocide. It's been over a year since the war with Hamas started and most statistics agree that around 40,000 Palestinians died in Gaza out of around 2 million. The total population in Gaza Strip even increased over the last year.

For reference during genocide in Rwanda 500k-800k of Tutsi were slaughtered over a 100 day period.

During Armenian genocide 600k-1.5ml people died as a result over a 2 year period.

In The Holocaust over a million of Jews were killed each year.

BTW almost half of Palestinian deaths are Hamas terrorists which makes it the lowest ratio in civilian to combatant deaths in similar environment. When someone tries to commit genocide they don't pause fighting so Polio vaccines can be distributed, or they don't move civilians out of the areas where major fighting is about to start.

 

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Interesting read. Shame the author doesn't understand sectoral balances though.

I agree though that balance sheet contraction is inevitable and desirable. The question is how.

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While the US may be a failing/declining hegemony the fact remains that with no apparent alternative it is the states less favoured(?) by them that will reap the consequences of the US  privilege first in terms of access to resources on the downward trajectory....one way or another the US will seek to control access to the resources it desires....currency debasement being one.

"Interesting" is one way to describe it.

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The US is looking more and more like a failed state

Failed state is way over the top. It is in crisis and definitely hegemon in decline but nowhere near the threshold of a failed state.

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Flying Wellington to Asia and beyond non-stop is a step closer to reality

  • Wellington Airport is to install a runway safety system, extending the usable runway length.
  • Engineered materials arresting system (EMAS) will act like gravel trap for aircraft.
  • With a longer runway, new aircraft like Boeing 777X and A350-900 can take off fully loaded with passengers and fuel.

https://www.stuff.co.nz/travel/360494370/game-changer-flying-wellington…

 

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I struggle to see the market. Wellington’s population is not large, and the city is in dire straights financially / economically. And catchment for international travel disrupted by the Cook Strait (and limited population lower NI). I also find it hard to see much international demand to fly to Wellington, ahead of Auckland or Christchurch.

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The population of the Wellington, Manawatu-Whanganui and Hawkes Bay regions combined is right around 1 million.

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More like 800k. And Hawkes Bay isn’t a quick drive. Yes can get a domestic flight, but can do that already to Auckland.

I might be wrong, but I am intuitively skeptical on this one

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The bulk of the Hawkes Bay population can make it to Wellington in 3.5 hours or less. I've driven Hawkes Bay-Wellington hundreds of times over the past 16 years, and Hawkes Bay-Taupo/Hamilton/Auckland many times as well, and heading south is by far the better option.

Those who live in more remote areas such as Wairoa and Mahia would likely drive to Napier and catch the cheapest connecting flight to either Auckland or Wellington, but that's a very small portion of the regional population.

Populations as of June 2024 (source: Stats NZ data explorer):
Wellington region - 550,600
Hawkes Bay - 185.400
Manawatu-Whanganui - 263,300

Admittedly the latter region stretches right up to encompass areas like Taumarunui, but over 200,000 live in the southern areas that would head south.

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Depends on the savings for those in the likes of Whanganui. The regional flights from Palmy or New Plymouth to AKL are outrageously priced but the time saving could be worth the extra to many

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I just re-read your comment and I think I got more of the gist of what you're saying: that people would fly from NPE rather than drive to Wellington. Unfortunately flights from from NPE to anywhere aren't exactly cheap, and a family trip to Wellington and flight from there, paying for long-term parking, can still work out cheaper and at least as time-efficient as flying from NPE to AKL.

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A regional airport at Ohakea makes more sense long term.  With high speed rail links.

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There is no way in Hell NZ can afford a bullet train....    we struggle to afford ferries....

 

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Thought another USA airline might have extended to Christchurch. Flight times that way to Europe break out quite evenly in term of the two sector times. Downside though being having to clear customs etc in transit. 

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WGTN to Sydney or Melbourne has always been a decent route,  maybe bigger planes on these type of flights

 

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Recall 767s and the SP Jumbo servicing Rongotai around the 80s? 

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Bigger runway and planes will help with the rush to the exits for Wellington residents

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Looking at government bond yields this morning my view is the market is leaving some meat at the short term as they contend with the RB and their insistent smoke and mirrors approach to how much and how fast they'll cut.

Going out to the medium term, they're betting government cost cutting is going bite next year, and an ongoing subdued consumer will leave the RB no choice but to keep cutting.

ANZ on the other hand are predicting a stellar 2025. :D

1 month 4.475%   

2 months 4.435%    

3 months 4.405%   

4 months 4.325%

5 months 4.255% 

6 months 4.175%    

1 year 3.935%   

2 years 3.955%

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Hearing on X that Trump's cryptocurrency advisory council expected to set up a strategic Bitcoin reserve.

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Gotta pay them underage girls somehow

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I thought we dealt to that guy....   

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But apparently its the dems who have child trafficking in their basement

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Interesting that bank economists think the OCR will bottom out at a neutral rate of around 3%. And that this sickly economy won’t need a stimulatory OCR setting.

In the absence of fiscal stimulus, the OCR is going to need to be closer to 2, than 3….

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If the current rates are supposedly pricing in a 0.5 already, then the normalised spread is absolutely huge at the moment.

Comments like that should be attracting a 'please explain' from the regulators.

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I would be pretty happy if I could get a 2-3yr fix at just below 5%. I don't think we are going to see mortgage rates starting with a 3 any time soon (unless there is another big black swan)

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I’d be ok with a nudge below 5% when I refix in May, will do 2 or 3 years

i think there is a good chance the OCR will be near zero, or even negative, in the next 5-7 years. 

It may not even take a ‘black swan’. For example there’s a high probability that there will be a moderate to major, damaging natural disaster in the next 5-7 years - a storm, earthquake, tsunami or volcanic eruption. Overlay that with the moderately high probability that there will be some sort of high impact, global geopolitical or economic event. And then overlay that with the likelihood that an OCR of 2.5-3% will be nowhere near enough to get the NZ economy out of its funk

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I reckon the RBNZ's mandate should force them to make allowances for one off events by trying to keep the OCR at a minimum of 4% when possible. This may also provide more financial stability - at the moment the RBNZ are fixated on CPI stability at the expense of interest rate stability. 

While we all know the stupid things Orr has done, there were also all those Bollard and Wheeler years where they should have very slowly lifted the OCR back to something more sensible, but instead they kept it low trying to get inflation up from 1% to 2% for no good reason. The meant that when Covid came along, Orr went to almost 0%, which has caused all sorts of issues. 

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Too much debt in the system for 4% to work the way it used to now. It's basically baked in deadweight loss for households and spending abilities for decades to come. 

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Indeed MH.  Mortgage rates are most likely to drop to 4.95% mid 2025, but unlikely to go below 4% unless there is serious trouble with the NZ economy.  Longer rates will stay close to where they are now, re-establishing a positive yield curve.  Still, borrowers can choose their term, and will choose the lower, shorter mortgages.

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If everyone goes 6month where will the funding come from for about 360bil of mortgages?

The NZ Term deposit base is way to small, and offshore funding may well be higher as it takes zero notice of RBNZ short end.

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Good on you for seeing the light DGM.  Still not cool for you to call me a moron 2 days ago for me saying the same as the article you shared:

"We need policy back to a more neutral setting.” A more neutral setting would be at or just under 3%, which is where he expected the OCR to bottom out."

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For goodness sake, this started Yvil because you called DGM a muppet (meaning: incompetent or foolish person) and it has gone from there. How about you apologise to DGM and then move on.

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DGM really hurt your feelings didn't he? 

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Muppets have feelings too

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I still see that its NActs job to provide fiscal stimulus rather then the hose of a low OCR.

Mathew Hooton does not seem to think there is any leadership in NAct, lucky we have Mr Orr in place......

 

 

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That Hooton piece is absolutely brutal.

"He will remain Prime Minister only because he lacks the self-awareness to know it would be better for New Zealand and his own reputation to accept he is completely out of his depth."

"Like Ricky Gervais’ David Brent, Christopher Luxon has an unfounded sense of his own personal charm."

"Luxon’s language is often derided as business-speak, but no genuine businessperson uses so much corporate twaddle. His language more resembles a cheap self-help book. Extraordinarily, he communicates even less substantively in the media and in person than the lamentable Dame Jacinda Ardern. Worse, if Luxon genuinely believes New Zealand’s long-term fiscal and health crises can be resolved through much-needed cost-cutting in Wellington alone, then he is as innumerate as he seems illiterate."

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Well  Mr Hooton should know. He was on the team for the ill fated Todd Muller’ tenure as leader of the opposition which soon resulted in Mr Muller withdrawing, and doing so candidly with quite some dignity. Perhaps if Mr Hooton had been invited on to Mr Luxon’s team and accepted a position, the column may have been penned differently. Then again, he may well have declined such an invitation.

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Yes one can’t but help feel that Mt Hooton is a bit bitter about that. 

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Ouch

He and Willis are even worse than the last PM and FM, and that is saying something 

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They are bad but not that bad

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At least Jacinda knew how to talk to people.

I swear if I hear one more time Luxon telling me what the reality is, then he spouts nonsense, I am going to lose it.

Between GR and NW though, both are as bad as each other.  But at least Willis is likeable. GR had going for him toward the end though that he had done the finance job for a while, so had a wee bit of experience.

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Would you prefer to hear the daily COVID numbers again or be talked to like a child by the prime minister? Perhaps stop watching Luxon on the news for your own sanity then. 

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Nowhere is reporting COVID numbers anymore, really, but every leader was all over the world when it was raging. You think if National was in power then Bill English wouldn't have been talking about them? Jacinda knew she had to talk to the people and include the lowest common denominator. You and I are probably educated, but a lot of people I know who are not, appreciated having someone to talk to them, instead of academics talking over their heads. They would turn off the TV when Bloomfield came on.

I think blue supporters just hate that their team currently has very little charisma, not since John Key. Was the same with people listening to Obama in the US, he was a great speaker and those that didn't support him hated him for it.  Since then Kamala and Hilary have about as much charisma as a wet paper bag. Get over your biases and you might be able to have a rational discussion.

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At least she had some positive intent, too. Lots of things I didn’t like about her govt, but I would have her as PM any day over Luxon. I really struggle to find any redeeming feature in him

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