Latest / Best of Business / Liam Dann: NZ Herald business editor at large ahead of Nicola Willis' half yearly economic and fiscal update

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Liam Dann: NZ Herald business editor at large ahead of Nicola Willis' half yearly economic and fiscal update · Best of Business

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  Speaker 1: You're listening to a podcast from News Talks'd be follow
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  Speaker 2: Liam dan is The Herald's Business editor at large with
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  Speaker 2: me in the studio. Good evening, A right, So it
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  Speaker 2: feels a little bit like the calm before the storm
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  Speaker 2: this week, but next week it's going to get gloomy.
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  Speaker 2: We've got the HIFU on Tuesday, current account deficit Wednesday,
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  Speaker 2: GDP data on Thursday.
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  Speaker 3: Yeah, and and none of it looking great, Like I
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  Speaker 3: was thinking, no tidings of joy, comfort, no good tidings,
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  Speaker 3: no joy, no comfort. Yeah. So you know, talking about
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  Speaker 3: the government trying to find money for fancy fairies and things.
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  Speaker 3: I think, you know, the Treasury has already given as
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  Speaker 3: much away as it can, but it looks like those
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  Speaker 3: Crown accounts are going to look worse on than hoped on.
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  Speaker 3: On Tuesday, the HIFU half year Fiscal and Economic Update,
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  Speaker 3: So I guess, you know, like it's it's a tough one,
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  Speaker 3: but they knew it was coming. But it does mean
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  Speaker 3: more borrowing. It does probably mean unless they can really
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  Speaker 3: finess things that they're going to have to put the surplus,
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  Speaker 3: you know, go further out in terms of looking for the.
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  Speaker 2: Surplus another year delayed.
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  Speaker 3: Yeah, so that's tough, and you know, it means that
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  Speaker 3: there's going to be more pressure on Nikola Willis's budget
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  Speaker 3: next year. So you know, look, I don't think anybody's
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  Speaker 3: expecting it to be great, but I mean it's because
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  Speaker 3: the tax take hasn't been there because the economy has
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  Speaker 3: been stuck in recession, as we're going to find out
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  Speaker 3: on Thursday, and it's the growth that's projected actually is
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  Speaker 3: lower and flatter than we'd hoped as well.
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  Speaker 2: Yeah, and because when you look at that, I sort
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  Speaker 2: of the OECD report was that last week had us
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  Speaker 2: at one point two percent next year growth.
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  Speaker 1: Yeah.
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  Speaker 2: Yeah, so it's still not like amazing, it's not a boom.
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  Speaker 3: And in fact, the Reserve Bank downgraded their forecast. They're
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  Speaker 3: looking at sort of two point four for the year after.
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  Speaker 3: So that's that's the sort of getting back to two
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  Speaker 3: point four. I remember when you it used to be
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  Speaker 3: over three was good. But they're saying that if we
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  Speaker 3: get up over three percent, that's going to be inflationary
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  Speaker 3: because our economy doesn't have the capacity anymore. We're not
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  Speaker 3: productive enough. But I don't want to get into a
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  Speaker 3: big discussion productivity right now. In fact, I'm going to
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  Speaker 3: avoid that before Christmas.
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  Speaker 2: That'd be great. Save it for Christmas Day.
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  Speaker 3: Yeah yeah, yeah, yeah yeah, with the cousins and uncles
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  Speaker 3: and aunts.
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  Speaker 2: That will love that. So we'll have us likely have
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  Speaker 2: a surplus delayed, we'll have more borrowing as a result
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  Speaker 2: of that. The quarter three GDP numbers, you did mention
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  Speaker 2: them briefly, but we'll confirm definitely that we're in recession.
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  Speaker 3: Right, Well, that's the expectation. So the second quarter was negative,
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  Speaker 3: so this will be the third quarter. It will be historic,
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  Speaker 3: so it will say, well, we were in recession. We
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  Speaker 3: knew that, and per capita, we know that we have
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  Speaker 3: been in recession for a couple of years. So there's
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  Speaker 3: but you know, I suppose if there's a bright spot
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  Speaker 3: and that the economists are starting to say that this
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  Speaker 3: might represent a low point, and so yeah, I mean,
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  Speaker 3: it's we're talking about low growth, but growth is sure
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  Speaker 3: going to feel a lot better than no growth at all.
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  Speaker 3: So you know, I'm still still trying to sort of
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  Speaker 3: get a little bit of optimism into the message for
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  Speaker 3: twenty twenty five. It's going to feel better than twenty
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  Speaker 3: twenty four.
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  Speaker 2: Yeah, it's hard, though, isn't it hard to Get's like
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  Speaker 2: trying to get blood out of a stone getting a
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  Speaker 2: smile out of a business correspondent. Yeah, that's right. Yeah, Yeah,
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  Speaker 2: we've got to be up there. Hey, let's go to
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  Speaker 2: the Fed over in the States. They are potentially smiling
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  Speaker 2: because they're going to get a rate cut, well, potentially
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  Speaker 2: get a rate cut next week. It's looking quite good.
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  Speaker 3: Yeah, because their inflation numbers came in. It I think
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  Speaker 3: it's two point seven, which sounds bad, but given that
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  Speaker 3: their economy is going quite you know, quite well, they
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  Speaker 3: haven't had a recession, they're still growing. Two point seven
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  Speaker 3: inflation was considered okay, on target, and that should give
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  Speaker 3: room for the Fed to do one more cut ahead
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  Speaker 3: of the new year. And you know, look, look there's
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  Speaker 3: a lot of bullishness about the American economy. Trump coming
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  Speaker 3: in and keeping it humming for however long till whatever
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  Speaker 3: the rest of the economics sketches up with them. But
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  Speaker 3: the markets are very happy. You know, we're seeing it
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  Speaker 3: in our key we saver here. So I guess for
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  Speaker 3: all the turmoil and political chaos over there, America is
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  Speaker 3: kind of a bright spot on the on the world
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  Speaker 3: stage right.
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  Speaker 2: Now, Lilliam, thank you very much. Good to see there's
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  Speaker 2: always Liam Dan, the Herald's Business editor at large, with
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  Speaker 2: me in the studio for.
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