Tim Bowring Quotations

Plunging business confidence and easing consumption should suppress import growth. Should the economic slowdown be more pronounced than expected, the trade deficit may have benefited.

With successive (interest) rate hikes in late 2005, inflation easing and the domestic economy in a slowdown phase, we believe the Reserve Bank will keep rates on hold over the near-term.

The significant drop in residential approvals (excluding apartments) suggests the impact of consecutive rate hikes in late 2005 may be finally taking hold, although we remain wary of calling a downward trend after just one month of negative data in this volatile series.

The New Zealand dollar continues to be hampered by the recent swag of weak economic data. We suspect the currency will continue to come under pressure.

The news will be frowned on by the Reserve Bank, which has yet to see a sustained easing in the housing market.