![]() ![]() The RBNZ is picking 4.9% and will find nothing to dissuade it from its view in these data."Īnother disinflationary point of note, Toplis said was NZIER’s "capacity utilisation variable". "This fits perfectly with our expectation that annual CPI inflation will fall to 4.5% by the end of this year. A net 48% still expect to raise prices but this is well down from the peak of 77% and last quarter’s 61%. Toplis said as labour is a critical factor in business costs, and the effective cost inflation associated with hiring appears to be diminishing, it should therefore come as no surprise to learn that business intention to raise prices is falling. But what it does show is that the balance between supply and demand is returning at pace." After all, a net 4% of businesses still intend to take on more staff. "All of the above is not to say the labour market is anywhere near weak yet. Labour as a major factor constraint also eased to 25% of businesses from 29% and a peak of 43%, he noted. "When the difficulty readings were last at these levels the New Zealand unemployment rate was sitting at around 5.0%," he said. "Again, ex-Covid noise you have to go back to December 15 to find softer conditions. This went from a net 37% finding it more difficult in the March survey to just 10% now. The change in difficulty finding unskilled labour was even more stark, Toplis said. "If you exclude post Covid noise, you have to go back to March 2016 to find an easier reading." ![]() Toplis noted that a net 38% of survey respondees still report that skilled labour is getting harder to find but this was down on the 44% who thought likewise a quarter ago and the peak of 73% back in December 2021. Today’s report provides strong confirming evidence of this." Anecdotal evidence continues to mount that surging net immigration and falling domestic demand are conspiring to dramatically lower staffing pressure. He said for BNZ's economists the NZIER survey "was all about the labour market". All of this means talk of raising interest rates again should be extinguished (for now at least)," Toplis said. ![]() "In short it provides very strong evidence that inflationary pressures are abating and that we are heading towards maximum sustainable employment at an accelerating rate. In an Economy Watch research note, Toplis said the RBNZ will be satisfied with the results of the June NZIER QSBO. Some economists are still forecasting that the RBNZ will need to be back later in the year with another hike. Unexpectedly, after raising the OCR by another 25 points (to 5.5%) at its last review in May, the RBNZ indicated it saw no further rises - at least for now. The RBNZ hopes to tackle inflation by taking heat out of the economy and an incredibly overheated labour market, which has seen unemployment settle at just 3.4%. As of the March quarter the country had an annual rate of inflation of 6.7%. The Reserve Bank (RBNZ) has been ramping up the OCR, from just 0.25% as of October 2021 to 5.5% as it battles to get inflation back into its targeted 1%-3% range. His comments follow release of NZIER's latest Quarterly Survey of Business Opinion(QSBO), which showed some marked declines in labour market and capacity pressures, albeit that cost pressures remained high. So, it's a phenomenon of the perceived demand and supply for the crypto as a valuable asset," said Subhash Chandra Garg, Former Finance Secretary.There's "next to no chance" of another Official Cash Rate (OCR) hike in the foreseeable future barring any shocks to the economy, BNZ's head of research Stephen Toplis says. And that is what explains the crypto meltdown. Now, when this is being withdrawn when the interest rates are high, you realize that you have no big liquidity to buy assets. So, people thought of why not invest and make money. That liquidity has lifted many asset classes, and this has lifted most of the crypto world. ![]() Now, after the end, this was basically driven by very large liquidity sloshing around the world. So, without knowing or without actually understanding this, people were buying. "There is no inherent intrinsic way of measuring the real worth or value of the crypto and, therefore, cryptos were sort of getting priced depending upon the transient demand and supply for last many months. Here is what experts have to say about the reason behind falling crypto markets: Bitcoin is currently trading at $28,954, down from the highs of nearly $68,000. Consider this: Bitcoin year-to-date return has come down by 40 per cent while Ethereum is down by 50 per cent. Liquidity has dried up due to central banks hiking rates due to which trading activity in cryptos has fallen and so have their prices. ![]()
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