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New Zealand's residential construction has reached a four-year low, indicating a potential recession. Spending on construction fell to NZ$5.2 billion ($3 billion) in the second quarter, the lowest level since 2020. Economists predict that the economy contracted in the second quarter due to high interest rates impacting spending and investment. The decline in construction activity is attributed to rising costs of materials and finance, leading to decreased buyer and developer activity. Fletcher Building, a major construction materials supplier, has also reported a decline in volumes and expects further drops in the coming year. [Extracted from the article]

New Zealand's local councils are facing high levels of debt, which may lead to credit rating downgrades, according to S&P Global Ratings. Many councils have neglected infrastructure maintenance and upgrades, particularly in water systems, and are now under pressure to spend heavily as pipes fail. Debt levels have risen faster than revenue, leading to downgrades in credit ratings. The average gross-debt-to-revenue ratio for 25 councils monitored by S&P is about 180%, more than double that of comparable countries like Canada. Councils have limited options to close the gap, such as raising taxes and cutting costs, and some may sell stakes in local ports or airports. The government's water reforms may allow councils to shift assets and debt to separate organizations, but S&P will continue to include them in its credit metrics if ownership remains with the council. There is a proposal to increase the debt cap for some councils from 280% to as high as 350%, which could help address the infrastructure deficit but would make New Zealand an outlier in terms of debt ratios compared to other developed countries. [Extracted from the article]

New Zealand house prices have fallen for the sixth consecutive month in August due to high interest rates and uncertainty about job security in a weakening economy, according to CoreLogic Inc. Property prices have declined by 0.5% from July and increased by only 0.7% from the previous year. The slump in confidence among buyers, coupled with rising unemployment and stretched housing affordability, has contributed to the decline in prices. While the recent interest rate cut may bring some optimism, experts predict that property values will continue to face challenges in the coming months. [Extracted from the article]

S&P Global Ratings is closely monitoring New Zealand's current account deficit and weak economic growth, but is generally comfortable with the country's sovereign rating outlook. The current account deficit, which is among the widest of advanced economies, reflects subdued exports, strong imports, and debt servicing costs. S&P expects the deficit to narrow in the next few years, but if it doesn't, it could negatively impact the rating. The agency also expects GDP per capita to recover as interest-rate cuts stimulate the economy, but if this doesn't happen, it could pose a downside risk to the sovereign rating. The government's overall deficit is projected to narrow in the coming years, but pressure on the fiscal balance remains due to the soft economy and the challenge of curbing government spending. [Extracted from the article]

New Zealand plans to increase the levy it charges foreign visitors from NZ$35 to NZ$100, effective October 1st. This decision has raised concerns about the recovery of the tourism industry, as it may make travel to New Zealand more expensive and less attractive. The tourism sector, which was New Zealand's largest export market before the pandemic, has struggled to recover due to reduced airline capacity and delays in travel resumption from key markets like China. While the government believes the increase will not significantly impact arrivals, critics argue that New Zealand should focus on improving its competitiveness as a destination instead. [Extracted from the article]

Fletcher Building, New Zealand's largest supplier of construction materials, has reached an agreement with the Western Australian government and other industry stakeholders to address plumbing failures in some homes. This agreement will allow affected homeowners to have their plumbing and associated damage repaired. Fletcher Building will incur a provision of A$155 million ($105 million) for this purpose. The company's stock rose 10.5% in response to the resolution. The issue arose when a builder claimed that plumbing failures were due to problems with Fletcher's ProFit piping, but Fletcher denied any manufacturing issues and attributed the failures to installation. The industry response has been entered into on a no liability, no admissions basis, and participants have agreed not to bring actions against each other. Iplex, a unit of Fletcher, will cover 80% of the direct costs incurred by builders, with the state government contributing the remaining 20% up to a cap of A$30 million. Fletcher estimates its share of costs to be around A$120 million, with additional costs for leak detectors and administrative expenses. Approximately 15,000 homes are believed to have the affected ProFit pipes installed. [Extracted from the article]

New Zealand business confidence has reached a 10-year high following interest rate cuts by the central bank, according to a survey by ANZ Bank. The survey found that 50.6% of respondents expect the economy to improve in the next year, up from 27.1% in July. The Reserve Bank's decision to cut the Official Cash Rate earlier than expected was driven by a slowing economy and increasing expectations of global interest rate cuts. The New Zealand dollar also rose following the release of the survey. Inflation expectations fell below 3% for the first time since mid-2021, but pricing intentions increased. [Extracted from the article]

Amazon.com Inc has received approval to purchase a small plot of land in New Zealand for its internet-from-space project. The company plans to install and operate telecommunications equipment on the 500-square-meter site, which is located at an undisclosed location. This move is part of Amazon's Project Kuiper, which aims to provide broadband internet through a constellation of over 3,000 satellites in low Earth orbit. The first satellites are expected to launch by the end of 2024, with customer tests beginning in 2025 and commercial service to follow later that year. The equipment on the New Zealand site will be used to offer broadband services to customers in the country. [Extracted from the article]

According to a survey by ANZ Bank, business confidence in New Zealand has reached a 10-year high in August following interest rate cuts by the central bank. A net 50.6% of respondents expect the economy to improve in the next year, the highest reading since May 2014. The Reserve Bank's decision to cut the Official Cash Rate earlier than expected was driven by a slowing economy and the anticipation of easing by the Federal Reserve. The New Zealand dollar also rose to its highest level since January 1 after the report. [Extracted from the article]

New Zealand's employment rate has declined for the fourth consecutive month, marking the longest slump since the global financial crisis in 2009. The drop in filled jobs is attributed to high interest rates, which have potentially pushed the economy into its third recession in less than two years. Economists predict that the job market will continue to weaken, with the unemployment rate expected to rise to 5.4% by early 2025. [Extracted from the article]

The New Zealand government has introduced reforms in the energy and electricity sector in response to a surge in wholesale power costs. The reforms aim to enhance energy security and affordability, with changes already underway to facilitate the construction of more renewable generation. Low lake levels and gas shortages have led to soaring power prices, causing some large manufacturers to reconsider their operations. The government plans to pass legislation to reverse the ban on offshore oil and gas exploration and remove regulatory barriers to the importation of liquefied natural gas. However, these decisions have been criticized by Greenpeace as "climate denial." The government also plans to review the performance of the electricity market and create a regime for offshore wind farm developments. [Extracted from the article]

New Zealand's government has announced a series of reforms in the energy and electricity sector in response to rising wholesale power costs. The reforms aim to improve energy security and affordability, with changes already underway to facilitate the construction of more renewable generation. Low lake levels and gas shortages have led to soaring power prices, prompting some manufacturers to consider closing their operations. The government plans to pass legislation to reverse the ban on offshore oil and gas exploration and remove regulatory barriers to importing liquefied natural gas. Additionally, electricity lines companies will be allowed to own and operate larger generation assets, and a review of the electricity market's performance will be conducted. [Extracted from the article]

New Zealand's retail sales have declined in the second quarter, indicating a potential third recession in less than two years. Sales volumes fell 1.2% from the previous quarter, and volumes per head of population dropped 1.6% to the lowest level since 2016. The decline in spending can be attributed to tight monetary policy and rising interest rates, which have squeezed household budgets. Economists predict further contractions in the economy, although growth is expected to return in the fourth quarter. The report also highlighted declines in industries sensitive to high borrowing costs, such as electrical goods and car yards, as well as accommodation and hospitality spending. [Extracted from the article]

Spark New Zealand is increasing its investment in data centers to meet the growing demand for artificial intelligence and cloud-based services. The company estimates that it will need NZ$1 billion ($610 million) of investment over the next five to seven years. Spark expects the New Zealand data center market to grow to 500 megawatts by 2030, and it currently owns 22 megawatts, or about 25% of the market. The company plans to spend up to NZ$90 million in the current financial year to expand its capacity at its Takanini and Aotea sites. [Extracted from the article]

The New Zealand government has proposed a Regional Deals framework to encourage local councils to invest in necessary infrastructure while discouraging frivolous spending. The framework aims to strengthen relationships between central and local government and coordinate capital investment. Prime Minister Christopher Luxon has challenged councils to rein in extravagant spending and focus on delivering essential services. The government plans to investigate performance benchmarks for local councils and consider options to limit expenditure on non-essential projects. [Extracted from the article]

New Zealand's population growth has continued to slow in the second quarter due to a decrease in immigration and more citizens seeking job opportunities abroad. The estimated population increased by 7,000 in the three months through June, the lowest rate since 2022. This increase was driven by a net immigration of 2,000 and a natural increase of 5,100. The sluggish economy and higher unemployment rate have led to more New Zealanders looking for work in Australia, while the Reserve Bank has cited declining immigration as a factor in cooling inflation pressures. The population increased by 93,500 or 1.8% in the year ended June 30, which is lower than the previous year's increase. Net immigration for the year was 73,200, down from 103,400 in the previous year. [Extracted from the article]

Kim Dotcom, the internet entrepreneur facing extradition from New Zealand to the US, has vowed to continue his legal battle after the New Zealand government confirmed that he should face trial in the US. Dotcom's now defunct file-sharing website, Megaupload.com, is alleged to have been involved in the biggest copyright infringement in US history. Dotcom and his co-accused maintain their innocence. Dotcom's legal team is currently working on a judicial review of the extradition order. [Extracted from the article]

The Reserve Bank of New Zealand (RBNZ) is looking for further declines in wage and price setting as it determines the pace of future interest rate cuts, according to Assistant Governor Karen Silk. The RBNZ recently began its easing cycle earlier than expected due to a slowing economy and decreasing inflation expectations. While investors are anticipating more rate cuts, Silk emphasized that the RBNZ is taking a measured approach and will rely on data to make future decisions. Uncertainties such as low productivity and potential inflationary pressure also factor into the bank's considerations. [Extracted from the article]

The Reserve Bank of New Zealand (RBNZ) is closely monitoring wage and price setting behavior as it determines the future pace of interest rate cuts, according to Assistant Governor Karen Silk. The RBNZ recently began its easing cycle earlier than expected due to a slowdown in the economy and inflation. While investors are anticipating further rate cuts, Silk emphasized that the RBNZ is taking a measured approach and will remain data dependent. The RBNZ's outlook for the economy is weaker than previous projections, with two consecutive quarters of contraction expected. Some economists have criticized the RBNZ's decision, but Silk defended it, stating that the available information at the time indicated persistent domestic inflation. [Extracted from the article]

The Reserve Bank of New Zealand has cut interest rates by a quarter percentage point to 5.25% in response to a slumping economy and slowing inflation. This decision comes as a surprise, as the bank had previously indicated that it would not cut rates until the second half of 2025. The bank's new forecasts suggest that rates will continue to fall in the coming months. The New Zealand dollar dropped after the announcement, while stocks rallied. [Extracted from the article]

The Reserve Bank of New Zealand (RBNZ) plans to gradually lower interest rates to a more neutral level, according to Governor Adrian Orr. The RBNZ recently cut the Official Cash Rate by a quarter-percentage point to 5.25% and expects it to decline to 3% by mid-2027. The central bank aims to carefully and slowly reach this target to ensure that inflation expectations remain anchored at the 2% target rate. Despite the current weak economy, the RBNZ predicts that gross domestic product will start expanding in late 2024 and throughout 2025, eliminating the need for further stimulus. [Extracted from the article]

The Reserve Bank of New Zealand has cut interest rates in response to a slumping economy and slowing inflation. The Official Cash Rate was lowered by a quarter percentage point to 5.25%. This decision comes as the bank's concerns over domestic inflation are being alleviated due to the struggling economy and rising unemployment. The New Zealand dollar also experienced a decline following the announcement. [Extracted from the article]

New Zealand's immigration rate has slowed to its lowest level in 16 months, with annual net immigration dropping to 73,270 in June. This decline is attributed to a record number of citizens leaving the country in search of better job opportunities and higher pay. The rising level of departures reflects a sluggish domestic economy and dimming prospects for employment. Additionally, the net number of foreign arrivals is also decreasing, indicating a potential peak in immigration. This information may have implications for the Reserve Bank's decision on interest rates and inflation control. [Extracted from the article]

Methanex Corp. has decided to temporarily shut down its methanol plant in New Zealand in order to sell natural gas to local power generators and alleviate the strain on the electricity market. Contact Energy and Genesis Energy have signed short-term contracts to purchase Methanex's gas entitlements, allowing them to operate their plants if necessary. The wholesale power prices in New Zealand have more than doubled in the past month due to low hydro lake storage levels and a shortage of gas. Methanex will keep its plant idle until October, and the proceeds from the gas contracts will exceed the margin lost on methanol production. Contact Energy will take 3.5 petajoules of gas, while Genesis Energy will take 3.2 petajoules, enabling them to generate electricity throughout the year. [Extracted from the article]

New Zealand's concrete production has dropped to its lowest level in over eight years, indicating a slowdown in construction. Output fell by 11% to 3.92 million cubic meters in the 12 months leading up to June, which is the lowest annual reading since early 2016, excluding the period of the Covid-19 lockdown. This decline in construction activity suggests that the country's economic growth may have stalled in the second quarter, potentially leading to a triple-dip recession. Builders and companies are expecting further deterioration in the economy and are reducing investment in property. [Extracted from the article]

New Zealand's unemployment rate increased to 4.6% in the second quarter, which was lower than expected. Despite a weaker economic outlook, the country unexpectedly added workers during this period. Employment rose by 0.4%, beating estimates of a 0.2% decline. The New Zealand dollar strengthened following the report, as traders reduced bets on the central bank cutting interest rates. While the jobless rate is still the highest in over three years, it suggests that inflation may return to the Reserve Bank's target range, potentially leading to rate cuts. [Extracted from the article]

New Zealand's unemployment rate increased to 4.6% in the second quarter, which was lower than expected, and the economy added workers despite a weaker outlook. Employment rose by 0.4% from the previous quarter, surpassing estimates of a 0.2% decline. The New Zealand dollar strengthened after the report, as traders reduced their bets on the central bank cutting interest rates. While the jobless rate is still the highest in over three years, it suggests that inflation will return to the Reserve Bank's target range, potentially leading to rate cuts. [Extracted from the article]

New Zealand is predicted to face a triple-dip recession due to high interest rates that are limiting spending and investment, according to Westpac Banking Corp. The country's gross domestic product is expected to have contracted by 0.6% in the second quarter and is projected to shrink by 0.2% in the third quarter. The economy has slowed down after the Reserve Bank of New Zealand raised interest rates to combat inflation. Investors are now anticipating rate cuts, and Westpac has adjusted its forecast for monetary easing to begin in October. Despite the challenging economic conditions, improvement is expected as the rate cuts take effect. [Extracted from the article]

New Zealand house prices have declined for the third consecutive month in June due to high interest rates, according to CoreLogic New Zealand. The drop in prices is the first quarterly decline since September of the previous year. The restrictive monetary policy of the central bank has affected consumer confidence and increased unemployment, leading to expensive mortgages. Economists argue that the Reserve Bank should lower the Official Cash Rate earlier than projected in order to stimulate economic growth. The average house price in New Zealand is now NZ$927,284 ($564,000). [Extracted from the article]

Queenstown Airport in New Zealand is investing in new technology to improve runway safety as it prepares for an increase in aircraft traffic. The airport will install an Engineered Materials Arresting System (EMAS) at each end of its runway. EMAS uses energy-absorbing cement blocks to slow down aircraft that exceed the landing tarmac. Queenstown Airport is known for its challenging landing conditions due to its short runway and swirling winds. The installation of EMAS will effectively increase the safety area of the runway. This is the first deployment of EMAS in New Zealand and Australia. The airport expects to complete the project by the end of the Southern Hemisphere summer. [Extracted from the article]

New Zealand businesses are becoming more pessimistic about the economy, which could lead to another contraction and put pressure on the central bank to cut interest rates earlier than expected. A survey showed that a net 44% of firms are pessimistic about the economic outlook for the next six months, up from 25% in the previous quarter. The central bank has kept interest rates high to control inflation, but this has resulted in reduced company profits and job cuts. The report suggests that the economy may slow even further in 2024, and there is a risk of a contraction in the coming year. [Extracted from the article]