Consumers and merchants have now returned from a rather wet summer holiday and material is starting to flow in and out of yards.
Local consumers are buying at current levels, albeit more cautiously, and this appears to be mirrored in overseas sentiment too. Container access to traditional offshore markets is becoming easier, with greater availability and some better pricing, but it is still some way off the levels desired by industry.
New Zealand’s Prime Minister Jacinda Ardern resigned last week amid mixed emotions. Her successor, Chris Hipkins, is starting to stamp his own mark with quite a policy shift for a government in its sixth year in office.
Economists and the Reserve Bank are still forecasting a recession in New Zealand by mid-year. Inflation remains at 7.2%, with a tight labour market and little sign of a softening of interest rates.
Australia is also experiencing high inflation at 7.8%, which is ahead of analysts’ forecasts. This will put added pressure on interest rates which are due to be reviewed in February and have a real impact on business and consumers. Australia is less likely to enter a recession than New Zealand but, with a continued tightening of monetary policy to counter inflation, this is still a possibility.