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Tuesday, 13 December 2016

Return of the rock star!

Rock star NZ returns

Well, fair shake of the sauce bottle mate, the rock star economy has re-entered the building. 

Although I must admit I don't spend a lot of my spare time thinking about New Zealand's economy, in the face of weak dairy prices I really hadn't expected to see the NZ's unemployment rate slinking all the way below 5 per cent.

On this metric, NZ still looks to be in better nick than Australia at 5.58 per cent unemployment, as has indeed been the case for some time now. 

Migration from Australia to NZ has in turn increased, although the rate of growth is gradually flattening out. 

Since January 2010, Australia has seen a net inflow of more than 116,000 Kiwis, but over the last year or two a few New Zealanders have dribbled back again, with Australia's economy and wages growth notably softer post-mining boom.

There are many parallels between Australia and NZ, with growth being driven by Chinese investment and immigration, international students, and rising private debt in the largest cities. 

Indeed, Statistics NZ confirmed that net immigration hit a record high in October:

"New Zealand’s unadjusted annual net gain (more arrivals than departures) of migrants was a record 70,300 in the October 2016 year, Statistics New Zealand said today. This surpasses the previous annual record of 70,000 in the September 2016 year."