BNZ Weekly Overview - May 21 2009

Welcome to the May 21 2009 issue of the BNZ Weekly Overview.

The NZD has crept back above 60 cents this week with the world increasingly buying into the green shoots theory and acting on it by buying growth and risky assets. This in spite of some truly appalling economic numbers released during the week including those showing the EU economy shrank 2.5% during the March quarter and the Japanese economy 4%.

In the absence of much local data wholesale interest rates have barely moved over the week. But the residential real estate sector’s outlook continues to improve on the basis of rapidly improving net migration inflows. Net inflows have turned in five months from +3,500 to +9,200 mainly because of a slump in people leaving the country. Further gains are highly likely though a return to the net gain of 43,000 reached at the peak of the last upward leg of the cycle in May 2003 is not yet expected.

WOMay21.pdf

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