The Monthly Economic Review is an overview of the New Zealand economy. It includes the latest data on New Zealand’s economic growth, unemployment, inflation, merchandise trade and balance of payments figures, along with certain financial data (such as the Reserve Bank’s official cash rate). The unemployment rate, economic growth and central bank interest rates for several of our main OECD trading partners are also included. Each publication highlights a specific topic of interest. The Monthly Economic Review is produced eleven times per year

Parliamentary Library (New Zealand)

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New Zealand’s unemployment rate rose 0.3 percentage points to 5.7 percent in the March quarter, with the labour force growing to a greater extent than employment. The labour force expanded by 1.5 percent over the quarter while employment rose by 1.2 percent (with part-time and full-time employment rising in the quarter). As a result, the number of those unemployed rose from 134,000 to 144,000 in seasonally adjusted terms.

Annual inflation rose to 0.4 percent in the year ended March 2016 (up from 0.1 percent in the 2015 calendar year), with consumer goods and services prices rising by 0.2 percent in the March quarter. The price of cigarettes and tobacco products rose by 9.4 percent over the quarter following an increase in tobacco and tobacco products excise duties from 1 January. If cigarettes and tobacco products were excluded from the Consumers Price Index, overall prices would have fallen by 0.1 percent in the quarter. The largest downward contributor to consumer prices was a 7.7 percent drop in petrol prices.

The national median house price rose to $495,000 in March 2016 (up $20,000 over the year), while the median house price in Auckland rose to $820,000 according to the Real Estate Institute of New Zealand (compared with $720,000 in March 2015). There were 9,527 dwellings sold during the month, the highest number of sales for a March month since 2007. Quotable Value has released average house price data for April, which shows that the national average house price rose by 12 percent over the year to $568,058, while annual house price inflation in Auckland was 16.5 percent (with an average house price of $942,760 in April).

The Reserve Bank Governor, Graeme Wheeler, left the official cash rate steady at 2.25 percent in April. This follows an unexpected reduction in the official cash rate in March of 25 basis points. In announcing his latest rate decision the Governor noted that the New Zealand dollar remains “higher than appropriate” given current international commodity prices for our main exports. He expects inflation to strengthen as capacity pressures build within the economy, and as the effects of lower oil prices drop out of the equation.

The International Monetary Fund has revised its projected world economic growth rate for 2016 to 3.2 percent (from its previous projection of 3.4 percent in January). The rate of growth was revised down for the advanced economies, while that for China was revised upward to 6.5 percent (from 6.3 percent). OECD composite indicators are pointing to an easing in the rate of growth in the OECD area as a whole

Analysis and Policy Observatory (APO)

Monthly Economic Review: May 2016

Monthly economic review - May 2015

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Monthly economic review - May 2015

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Analysis and Policy Observatory (APO)