Weekly Digest – 7 February 2024

Welcome to our Weekly Digest – stay in the know with some recent news updates relevant to business and the economy.

Paul Conway maintains Reserve Bank’s hawkish stance, countering talk of OCR cuts

The Reserve Bank (RBNZ) is continuing to push back against financial markets, which are betting on the central bank cutting the official cash rate (OCR) this year. RBNZ chief economist Paul Conway said “Recent economic data suggest that monetary policy is working, with the economy slowing and inflation easing. But we still have a way to go to get inflation back to the target midpoint of 2 per cent.”

Navigating your business through 2024

Now, according to a BNZ expert who has spent 16 years helping hundreds of customers navigate several difficult economic cycles, it’s a good time to look ahead to 2024, to plan and prepare your business for a year in which continued headwinds can be expected to blow – and where business goals might have to be revised.

Cost of living: Annual household living costs increased 7 per cent – who was hit hardest?

Household living costs rose 7 per cent in the 12 months to the December 2023 quarter, outpacing inflation, Stats NZ said.

Minimum wage rising to $23.15 per hour from 1 April 2024

The Workplace Relations and Safety Minister has announced that the adult minimum wage will be rising to $23.15 per hour from 1 April 2024. This is an increase of 45 cents per hour from the current hourly rate of $22.70.

Economic outlook brighter with GDP average forecast at 2% in 2024

Migration is boosting spending and forecast to brighten the economic prospects for the main centres, led by Auckland. Infometrics forecasts the Reserve Bank would begin cutting back on the official cash rate (OCR) from August, as population growth eased labour market pressures and wage growth, driving annual inflation back to within its 1-to-3 percent target.

Here’s how Govt ‘will create opportunities’ for business

A pullback in public sector activity will create opportunities for businesses – and there is much Government can do to boost the economy, says former Finance Minister and now Icehouse board member Steven Joyce.

One-third of flood losses in New Zealand not insured, study finds

A report by the New Zealand Institute of Economic Research (NZIER) revealed that the uninsured losses from the Auckland Anniversary Weekend floods and Cyclone Gabrielle in New Zealand totalled $2.3 billion, representing a third of the affected physical assets.

Reducing barriers for financial services

On 31 January 2024, the Government announced plans to reform the Financial Markets (Conduct of Institutions) Amendment Act (CoFI) and the Credit Contracts and Consumer Finance Act (CCCFA). These reforms will also seek to simplify licensing requirements so financial institutions will only be required to hold one conduct licence overseen by the FMA.

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