Headlines on Bloomberg
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Added 9this from Bloomberg website, it appears to be a separate report, though:
Nathan Penny, an economist at ASB in Auckland:
- “If they (Fonterss) were to revise that down to NZ$6.50, which appears reasonable, that would be worth about NZ$800 million to Fonterra farmers”
- “Less income in the economy, less demand, means less upward pressure on inflation. It could affect interest rates further out.”
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Its all kiwi so far today …
- New Zealand – Dairy auction overnight … bleh …. prices continue their slide
- New Zealand Q2 CPI +0.3% q/q (vs. +0.4% expected and +0.3% prior)
- Westpac lowers forecast for 2014/15 milk payment to NZ$6/kg
- Westpac and ANZ on the New Zealand CPI result
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Also, a note from ANZ on the dairy auction …
- Say there is further downside risk to their already downgraded milk price forecast
- This poses a risk to the NZD and RBNZ’s monetary policy
- While dairy prices are tracking lower, and the kiwi higher, than RBNZ forecast in June, it means means financial conditions are tightening materially
- ANZ still favour a rate hike on July 24 but not another hike before year end
- They say the kiwi is looking vulnerable for a correction over the coming months
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While I’m on the kiwi, Bloomberg have thisup on their site: N.Z. Inflation, Dairy Prices Ease Pressure on RBNZ to Raise Rate
In brief …
Dominick Stephens, chief New Zealand economist at Westpac in Auckland:
- “A July OCR hike may not be quite such a sure thing as previously thought”
- “In combination with the decline in dairy auction prices overnight, today’s data is material for the interest rate outlook.”
