Of Interest

The New Zealand First deputy leader and finance spokesperson Shane Jones is calling for higher growth and more productivity as a way to bring prosperity to a wider class of New Zealanders. He adds this is the way to help Maori overcome negative social statistics, and the thicket of regulation governing business in all areas of the economy only makes things worse for everyone. Jones adds tax relief...

The Chinese people are very concerned about their country's tense relationship with the United States and it's a factor in weak consumer confidence, says Beijing-based David Mahon. Mahon, a New Zealander who has lived in China since 1984, is Managing Director of Mahon China Investment Management. He spoke to interest.co.nz in the latest episode of our  Of Interest podcast . Mahon says during a rec...

Kia ora, Welcome to Friday’s Economy Watch where we follow the economic events and trends that affect Aotearoa/New Zealand. I'm David Chaston and this is the international edition from Interest.co.nz. And today we lead with news central banks in both China in the EU have been active overnight, both dovishly. But first up, initial American US jobless claims last week came in little-changed at +220,...

New Zealand ought to change its political party funding system so it encourages politicians to connect with as many ordinary New Zealanders as possible, Max Rashbrooke argues, whilst noting it's not in political parties' interests to do so meaning such a change probably won't happen anytime soon. Rashbrooke, a senior research fellow in the school of government at Victoria University, spoke about p...

The Commerce Commission should be looking closely at banks' overall interest margins in its market study into personal banking services, says David Cunningham. Cunningham is CEO of Squirrel Group, a mortgage broker that also offers lending and investing products and services, and a former CEO of The Co-operative Bank and manager at Westpac New Zealand. In the latest episode of interest.co.nz's  Of...

New Zealand's anti-money laundering (AML) regime could be simplified and improved, although care would need to be taken to avoid jeopardising our good standing in the international community, not to stop information flow to the police, and to avoid creating loopholes criminals can exploit, says leading AML lawyer Gary Hughes. Hughes speaks about the Anti-Money Laundering and Countering Financing o...

Ten years from now Kiwibank CEO Steve Jurkovich wants New Zealanders to be thinking about their big five, rather than big four, banks, with Kiwibank in there mixing it with the four Aussie owned banks and not the smallest among them. In the latest episode of interest.co.nz's  Of Interest podcast , Jurkovich speaks about where the now 21 year-old Kiwibank has come from, where it's at, and where it'...

New Zealand survived a tight electricity supply situation on Friday morning - the 12th so far this year.   It happened after Transpower warned the residual quantum of electricity available for use was sinking towards the 200 megawatt danger mark between 7 am and 9 am.  In the end, the 200 megawatt level was not breached, and even if it reached zero, unused reserves would still be available. But it...

Like it or not banks are a cornerstone of our economy, meaning they'll need to be a key influence in the push to decarbonise. One of the ways BNZ is trying to do this is through membership of the  Net-Zero Banking Alliance  (NZBA). Speaking in interest.co.nz's  Of Interest podcast  Rebekah Cain, BNZ's Chief Sustainability Officer, describes the NZBA as "a group of banks committed to transition the...

At the heart of suggestions the so-called BRICS countries may develop a new international currency system based on gold that's separate from the US dollar are some simple necessities, according to Nathan Lewis. The United States-based Lewis spoke about this issue in a new episode of interest.co.nz's  Of Interest podcast .  Lewis runs New World Economics , is an author, a former analyst and money m...

2023 has become the year of AI. Hype and doomsaying about AI, or artificial intelligence, is hard to avoid. A key catalyst was OpenAI's release of AI chatbox ChatGPT late last year. So should we be excited or fearful about the rise of AI, or both?  I discussed this with Michael Timothy Bennett, an AI researcher at the Australian National University, in the latest episode of our  Of Interest podcas...

Central banks' use of monetary policy to fight inflation is working, but in New Zealand we need to look at evidence demand and prices are being impacted rather than current inflation data, says ANZ Banking Group Chief Economist Richard Yetsenga. Speaking in the Of Interest podcast ,  Yetsenga says news of an inflation fall in the United States suggests the Federal Reserve is close to an extended p...

Sam Bankman-Fried was a nerdy billionaire and rockstar of the crypto industry, living a lavish lifestyle in the Bahamas, with celebrities advertising his cryptocurrency exchange FTX as he gained influence in Washington DC. Then it all went wrong. FTX collapsed, leaving an US$8 billion hole and lots of angry customers. FTX was placed in Chapter 11 bankruptcy protection. Worse for Bankman-Fried, he...

The world needs to move to a new economic system where growth is replaced as the ultimate goal by meeting human needs within ecological limits, argues Gaya Herrington. Speaking in the Of Interest podcast Herrington explains how working at the Dutch central bank, De Nederlandsche Bank, during the Global Financial Crisis led to her realising how interconnected things were. When subsequently studying...

If we were building Auckland from a blank canvas with the knowledge we have today there are lots of places where you wouldn't build, says Martin Brook, Associate Professor of Applied Geology at the University of Auckland. Speaking in the  Of Interest podcast ,  Brook says this year's spate of extreme weather events means we are talking more about the dangers of floods, slips and landslides, but th...

If you're looking for profit-led inflation you should probe consumer facing industries rather than look across the whole economy, says UBS chief economist Paul Donovan. Speaking in the  Of Interest podcast ,  the London-based Donovan says profit-led inflation, whereby companies are able to expand profit margins and convince customers it's fair to do so, is the third wave of inflation experienced i...

Following the spate of extreme, damaging and costly weather events in the North Island this year we shouldn't let a big disaster go to waste, Tower Insurance CEO Blair Turnbull argues. Speaking in the latest episode of the  Of Interest podcast ,  Turnbull says the realisation from frequent and extreme weather such as the Auckland anniversary floods and Cyclone Gabrielle is that we are seeing clima...

New Zealand's record current account deficit is significant in both a NZ and global context, and there are interesting comparisons to draw between 2023 and 2011 when S&P Global Ratings last downgraded NZ's sovereign credit rating, S&P's Martin Foo says. The current account deficit, reflecting we're spending more than we're earning overseas, swelled to its highest dollar value of $33.8 billion last...

Economists Eric Crampton of the New Zealand Initiative and Craig Renney of the Council of Trade Unions share their views on what Budget 2023 got right and what it got wrong. Crampton explains why giving subsidies to the game development industry is a sort of mutually assured waste of taxpayer money, and how tobacco tax could mean the government books take an extra year to return to surplus.  Renne...

Another round of political brinkmanship is playing out in Washington DC over the United States government's debt ceiling. There are predictions of global financial chaos if Democrats and Republicans can't agree on a deal to raise or suspend the debt ceiling, currently at US$31.4 trillion, soon. Treasury Secretary Janet Yellen says if something's not done the US government won't be able to meet its...

The cost of the Reserve Bank's buy-up of government bonds during its 2020-2021 quantitative easing (QE) programme has come into focus as interest rates have risen. Notably the balances of exchange settlement accounts held by banks and others with the Reserve Bank soared as the central bank bought government and local government bonds off banks in the secondary market, peaking at $56.4 billion last...

New Zealand's $33.8 billion record current account deficit was a shock to overseas investors in NZ government bonds, but is ultimately probably not something people will lose a lot of sleep over, says Sydney-based interest rate strategist Martin Whetton. Statistics NZ last month reported the annual current account deficit reached $33.8 billion last year, equivalent to 8.9% of gross domestic produc...

To boost New Zealand's ability to fight inflation Auckland University's Tim Hazledine suggests broadening the Commerce Commission's powers, looking at extending the Pharmac concept, and cutting Goods & Services Tax (GST) to 10%. Hazledine, Emeritus Professor of Economics at the University of Auckland, discusses this and more in the latest episode of interest.co.nz's  Of Interest podcast . Followin...

New Zealand Debt Management, the Treasury unit responsible for managing the Government's debt, isn't seeing any notable increase in demand for its inflation-indexed bonds despite high inflation both in New Zealand and overseas. Speaking in interest.co.nz's  Of Interest podcast ,  Kim Martin, Director of New Zealand Debt Management (NZDM), says you might expect more interest in inflation-indexed bo...

Excess profits are unlikely to be a significant driver of inflation as business profitability has been declining as inflation has risen, an economist says.  Speaking on the Of Interest podcast , principal economist at the New Zealand Institute of Economic Research, Christina Leung, said businesses have reported cost pressure becoming more intense as inflation has surged.   Earlier, the unprecedent...