BNZ Weekly Overview 30 August 2007

Welcome to the August 30 edition of the BNZ Weekly Overview

The Kiwi dollar has edged slightly lower this week and is sitting just above 70 US cents while wholesale interest rates have also fallen on the back of expectations that United States monetary policy will be eased in coming weeks and months. World financial markets are still flip-flopping about on a daily basis between optimism that the liquidity crisis is easing and fears that it may be getting worse. This process is likely to continue for some weeks if not months generating continued volatility in financial markets. Locally we have seen business sentiment improve with worries about the liquidity crisis and rising New Zealand interest rates clearly offset by some pleasure at a falling New Zealand dollar and booming commodity prices.

BNZ Weekly Overview 30 August 2007 (PDF)

Best regards

Tony Alexander
Chief Economist
Economics Bank of New Zealand

ENDS

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