The New Zealand economy’s recovery from the stagnation of the last two years will remain patchy until mid-2025, according to Infometrics’ latest forecasts. Although the Reserve Bank’s interest rate cuts since August have finally provided some light at the end of the tunnel for Kiwis, continued increases in the unemployment rate will mean households remain cautious in their spending decisions over the next nine months. The high proportion of mortgage lending on fixed rates also means that the easing in monetary conditions will not have an immediate effect on household budgets. Read

Economic pressures are getting real for people this year, as higher mortgage rates continue to suck more money out of household budgets, and a swathe of recent job losses undermine income security. Infometrics’ latest economic forecasts show annual GDP and private consumption spending growth briefly... Read

New Zealand entered its first non-lockdown recession since 2010 in the March 2023 quarter, with GDP shrinking 0.1%, following a 0.7% contraction the previous quarter. Although this slight decline in GDP confirms that the Reserve Bank’s interest rate rises are having their desired effect, the range of results across different industries shows that some parts of the economy are hurting more than others. Read

Net migration continues to confound, with a rapid series of twists and turns in trend. The latest official data shows that at the end of January 2023, annual net migration had surged back to over +33,100, compared with a net outflow that got as big as -19,700 in the year to February 2022. Read

Over the last two years, consumers have experienced high inflation across a wide range of goods and services. Car owners, and prospective buyers, are no exception, as vehicle-related prices have risen strongly since the start of the COVID-19 pandemic. Higher prices for new and used cars have put pre... Read

Cyclone Gabrielle has wreaked havoc across Gisborne and Hawke’s Bay, leading to the deaths of 11 people and resulting in a huge cost to the economy. This article examines the toll that Cyclone Gabrielle took on cars and commercial vehicles in Gisborne and Hawke’s Bay and attempts to estimate the ext... Read

In March 2022, the government implemented a reduction in the tax it charges on fuel, discounting the fuel excise duty (FED) by $0.25/L. This “temporary” measure has been repeatedly extended over the last year and is currently set to finish at the end of June 2023. With an election in October 2023, and our outlook for fuel suggesting that prices will remain elevated over the next five years, we find it unlikely that the reduction will simply end mid-year. Read

The cost pressures on firms providing road transport services have increased substantially in the last two years, driven by a combination of higher costs for capital, fuel, and labour. The cost of transport equipment, particularly for the heavier commercial vehicles typically used for commercial roa... Read

Business investment intentions have been on a downward trajectory since early 2022. Historically, lower investment intentions have coincided with weaker commercial vehicle registrations, since vehicles are an investment decision. Investment intentions in the construction and agriculture sectors are ... Read

Fuel prices skyrocketed in early 2022 after the Russian invasion of Ukraine, with prices for 91 petrol and diesel increasing 26% and 74% in the first six months of the year. Petrol prices have since started to ease, but diesel prices remain stubbornly high. Read