Waiting for the release of the official Gross Domestic Product (GDP) figures has become more exciting since I launched GDPLive. It is like watching the lotto draw when the numbers drop, and you keep checking your ticket. GDPLive (gdplive.net) uses large amounts of daily transaction data from New Zealand companies…

The US Bond Market — What is Normal? and why should we care? By Stuart Henderson. First published in the NBR. Introduction The Silicon Valley Bank (SVB) collapse have refocused our attention to “abnormalities” existing in the US bond market. This article explores some potential answers to the question, what…

By Stuart Henderson The RBNZ has had a 30-year international reputation for being the world’s best little central bank and built this reputation on the back of the 1990 version of the monetary policy committee remit (Remit). Is this remit still fit for purpose? …

By Oliver Hartwich Hindsight is a wonderful thing. It is often only after time passes that one realises what one should have done differently. These are decisions one should not have made if one had known about later events. However, hindsight can also provide a cheap excuse. That is when…

Solving the US dollar puzzle After many years of relative stability, global currency volatility is back. Why now? Economics 101 tells us that there is a negative relationship between inflation and currencies. …

Central Banking Funambulism and Real-time Data Nearly every central banker in the world is currently embarking on a tightrope journey, with the endgame being the successful containment and lowering of inflation back to policy target settings. Falling off the tightrope can be dangerous for both the funambulist and the central…

GDP June 2022 Quarter Values Released — How did we do? The first three months of this year weren’t exactly perfect for New Zealand’s economy — on a quarterly basis, our economy shrank by 0.2 percent, and the annual growth rate fell from 5.6 percent to 5.1 percent. …

US Inflation, Jackson Hole, Fed Chair Jerome Powell and US Interest Rates — What’s the connection to New Zealand? On Friday evening (26 August 2022) at the Jackson Hole symposium, Fed Chair Jerome Powell gave his much-anticipated speech about the financial markets guidance on the US central bank’s monetary policy…

Over the past decade we have witnessed an unprecedented period of “time-adjusted risk-return imbalance”. By this I mean that bond investors have not been adequately rewarded for the level of risk they assume on both the credit profile and the maturity term of bonds. The starting point for any decision…