This morning (9am on 25 September 2009) the money markets were at the following levels:
Official cash rate 2.50% (unchanged)
90 day bill rate 2.78 (unchanged)
1 year swap rate 3.14 (up from 3.03)
3 year swap rate 4.73 (up from 4.63)
10 year bond rate 6.05 (up from 6.00)
Kiwi dollar 0.7205 (up from 0.6960)
Good News on the Economy
According to official GDP figures, during our last quarter we experienced a tiny amount of growth, which officially means we are moving out of recession, (according to the economists).
This is positive news but I think the good times are still a way off (here’s an article The ghost fleet of the recession anchored just east of Singapore that is pretty grim and indicates that not everything is as rosey as some would like us to believe) .
We are still susceptible to any one-off hits, such as a major company collapse, an international crisis such as a terrorist attack, or an oil price surge. Our unemployment numbers will continue to increase over the next twelve months (even if Key is saying that he thinks it has leveled out now on last nights news).
Our currency is high (and went higher overnight) which makes an export or tourist related recovery unlikely. Overall though the latest result is positive for our economy but we are still in a fragile state, and need another two improving quarters before we can say the recession is truly behind us.
Current Rental Market
Those wanting to rent a residential property are seeing a greater choice available. This is not unexpected in a recessionary environment, as younger renters return home, existing renters may get an extra flatmate to cut costs, and householders may get a boarder to supplement their income.
There are more “To Let” signs appearing around our cities and Trademe has also noted an increasing number of properties available.
I believe this will be a short term phenomenon, as the rental market over the median term is likely to firm up. This is because our population is increasing both naturally and via immigration.
