BNZ Weekly Overview.

Welcome to the February 5 2009 issue of the BNZ Weekly Overview.

Good evening everybody - although where I am at the moment in Hamburg, Germany, it is the start of yet another very cold cloudy morning.

This week in New Zealand we have seen the release of data showing sharp declines in registrations of cars and commercial vehicles, further weakness in residential construction prospects, but some continued strength in non-residential construction and an interesting improvement in net migration flows. There was even 0.9% jobs growth during the December quarter - if you believe the data, and frankly there seem to be worsening problems with this particular survey by Statistics New Zealand.

New Zealand's unemployment rate has risen to 4.6% from 4.2% in the September quarter and 3.4% a year ago and looks easily headed towards 6.5% given the redundancies being announced at the moment. Offshore there is continuing deep concern about the ability of banks in many countries to lend when they don't know to what extent their capital bases will be eroded by still falling housing markets in the United States and United Kingdom in particular.

The Kiwi dollar has weakened further against everything except the Australian currency and euro over the past week while wholesale interest rates have not moved all that much from where they got to last week after the Reserve Bank made its second 1.5% cut in the official cash rate.

Next week one will be in Paris and hopefully there will be sufficient time to put the Weekly Overview together. But don't be surprised if it doesn't appear.

ends

© Scoop Media