Weekly Digest – 17 July 2024 – Flintoffs Chartered Accountants

Weekly Digest – 17 July 2024

Welcome to our Weekly Digest – stay in the know with some recent news updates relevant to business and the economy.

Trade Minister Todd McClay in Italy for G7 meeting

Trade Minister Todd McClay is in Italy this week for New Zealand’s first-ever G7 meeting. Two-way trade with Italy was valued at NZ$2.22 billion last year, and McClay told Morning Report it was important to be at the G7 meeting of trade ministers, speaking for New Zealand.

Reserve Bank unlikely to be swayed by weakening business confidence

Businesses remain downbeat on their own prospects and the wider economy, while inflation looks likely to continue easing, but don’t expect the central bank to react.

Adapt or dye: change needed to save wool

“You can go for a sheep without wool, you can go for a sheep with less wool, or you can go for a sheep with better wool, but you’re going to have to change,” Lincoln University lecturer Dr David Scobie told farmers at a Beef + Lamb NZ field day at Telford’s Balclutha campus.

Official Cash Rate steady, Reserve Bank softens stance as stats show tough times for economy

The Reserve Bank of New Zealand has held firm, leaving the Official Cash Rate (OCR) unchanged at 5.5% for the eighth consecutive time. “Restrictive monetary policy has significantly reduced consumer price inflation, with the committee expecting headline inflation to return to within the 1% to 3% target range in the second half of this year,” the Monetary Policy Committee statement said.

Inland Revenue to spend $29m on chasing tax cheats

Inland Revenue will spend $29 million – allocated in the last Budget – on chasing up tax cheats. The department will be targeting a broad range of people, from students to multi-nationals and crypto traders.

Thousands sign up for benefit as data points to further job losses

Almost 4500 more people have signed up to the Jobseeker Work Ready benefit since the start of May — and more grim data about the state of the country’s businesses could foreshadow more job losses.

NZ gas production set to fall below demand

New Zealand’s natural gas production is expected to drop below demand over the next three years, the Ministry of Business, Innovation & Employment (MBIE) says. The department’s data shows the country’s gas reserves will produce 10 petajoules (PJ) less than recent demand levels for “at least” the next three years, it said.

How insurers are rethinking New Zealand’s risk

Insurance premiums have doubled in the past decade according to Reserve Bank analysis, as insurers rethink their approach and pricing of risk. The increases to date have been due to many factors, including the impact of Cyclone Gabrielle and flooding events, higher construction repair costs and, importantly, pressure from global reinsurance companies.

NZ tourism recovery marooned: Visitor numbers still at around 80% of pre-Covid levels

Overseas visitor arrivals were 179,700 in May, and have stalled, but the strong recovery of New Zealanders taking trips overseas continues. Stats NZ monthly figures show the number of visitor arrivals was up by 19,300 from May 2023. The biggest changes were in arrivals from Australia (up 9300) China (up 5400 – although well down on pre-Covid levels) and Taiwan (up 1700)

Lack of trucks on the road confirms economic slowdown

An unprecedented drop in heavy traffic suggests economic growth in the second quarter could be ugly reading. The ANZ Truckometer for June shows the heavy traffic index, pointing to economic production, slumped 5.2 percent – the biggest drop ever recorded outside of Covid-19 lockdowns.

Westpac drops mortgage rates, term deposits

Westpac New Zealand has dropped its short-term home loan rates as sentiment around when the Reserve Bank (RBNZ) will deliver its first rate cut since 2020 continues to shift.

Weekly Digest – 17 July 2024