Inflation jumps to a 12 month high
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Newsroom
15 hours ago
- Newsroom
Ripple effects of Trump tariffs leave gloomy trade outlook
The global economic uncertainty caused by Donald Trump's tariffs will likely reduce global demand for New Zealand exports and make the coalition's goal of doubling exports even more challenging, the Reserve Bank's chief economist says. However, the fall in export demand is likely to be considerably smaller than that seen following the 2008 global financial crisis, Paul Conway says. Speaking at an Export NZ event on Thursday, Conway said New Zealand was deeply influenced by global developments, meaning 'even if tariffs don't hit us that hard directly, we will feel the ripple effects as they work through the global economy'. The global economy had been dealing with more frequent and varied shocks since the early 2000s, with uncertainty on the rise and economic tools increasingly used for political and strategic ends. 'It makes the rules of the game less clear. It makes the global economy more difficult to navigate, with spillover effects into the domestic economy.' The direct impact on New Zealand would be softened by the fact that 'we're not actually as export driven as we like to think we are', with the export share of GDP having fallen for decades, along with the fact that tourism exports were intrinsically difficult to tariff. Conway said meat, wine, and precision instruments like medical devices would be among the most directly affected export sectors. The US bought little of the types of dairy products exported by New Zealand, meaning the Trump tariffs would have a minimal impact on global dairy prices. US demand in global markets was stronger for the goods that New Zealand imported, meaning there was likely to be greater price reductions for imports than exports. The tariffs would also reshape global trade flows as buyers and sellers adjusted, with American buyers likely to look for goods from countries subject to lower tariffs in addition to locally made products. While Chinese exports to the US had dropped by roughly 15 percent in the year to June, the country's exports had held steady overall as shipments were redirected to the European Union, Southeast Asia and other countries. New Zealand's technology sector could benefit from reduced US demand for Chinese products, while the same could be true for meat exporters if a 50 percent tariff on Brazillian imports into the US went ahead as planned. With our current 10 percent tariff no higher than any other country, Conway said we were on the right side of global shifts in trade flows. However, the broader uncertainty caused by Trump's tariffs would slow the New Zealand economy down, with household spending and business investment heavily affected by the lack of confidence about what the future had in store. 'Why invest in new machinery if you're unsure about future demand? Why take on debt when you're unsure how interest rates or prices might move given increased macroeconomic volatility? It's a similar story with households.' Overall, there was likely to be a negative demand shock that reduced medium-term inflation pressures in New Zealand – a contrast to the US, where the tariffs were expected to add to inflation. While the effects would not be comparable to the GFC – another global shock with its epicentre in the US – there would be a material slowdown in trading partner growth. Asked how the gloomy trade outlook would affect the coalition Government's goal of doubling exports by 2034, Conway said he got in trouble for commenting too much on current government policy but described it as 'an ambitious target' and 'challenging'. 'Full power to the Government, and to the businesses in behind that; actually, I think it's sort of up to businesses. The Government creates the incentives, and it's businesses that need to do that.' Trade in services (outside of tourism) was the bright spot for New Zealand exports, which made sense given the country's remoteness and the weightless nature of trading products via digital means. The longer levels of uncertainty remained high, the more pronounced the drag on trade and economic growth would be, Conway said. 'A short spike in uncertainty isn't that big a deal, even if it goes extremely high, but if it goes up and sort of stays there, that can sort of suck down growth. 'I'm not sure that we're looking into that, [but] I do think there will be a sigh of relief when the tariff schedule of the US does remain constant. It's not just the fact of tariffs, but the fact of them changing all the time, which is contributing to uncertainty.'
NZ Herald
15 hours ago
- NZ Herald
New World Pt Chevalier to open next to derelict building and abandoned tyre site
Next door is a third of a hectare ex-Magnum Motors corner site, also fronting 8 Parr Rd North but looking in very poor shape. New World Pt Chevalier, Auckland nearing completion. 22 July 2025 New Zealand Herald photograph by Jason Dorday The contrast between the two sites could hardly be greater. How did such a situation arise and what do council and local board people say about it? The state-of-the-art supermarket is aiming to draw tens of thousands of shoppers weekly in the suburb, which currently only has a small Woolworths. The unsightly empty site next door is owned by New Zealand-registered company Hobson One. Its director is Zhengzheng Guo of Remuera. Derelict buildings in front of and around the New World Pt Chevalier which is planned to open in August. Photo / Jason Dorday He has applied for resource consent for apartments to be built in blocks beside the New World. But he is yet to succeed. 'An application was lodged in December 2024 for a three-storey mixed-use building - retail and residential,' a council spokesman said. The application was now on hold, awaiting further information, the spokesman said. Advertising showed he did try to sell the site two years ago, before downscaling plans. In June 2023, he advertised it with Bayleys. 1150-1160 Great North Rd, Pt Chevalier, Auckland, outlined in red. This was in 2023 when Bayleys' agents were marketing the property for sale. Since then, the New World Pt Chevalier has been built on the ex-RSA site next door (above the red line). Photo / Bayleys The big lot was marketed as a development site, with a 177-unit resource consent. Bayleys agents Gerald Rundle and Marty van Barneveld marketed it but were unsuccessful in selling it. Derelict buildings in front of and around the New World Pt Chevalier which is planned to open in August. Photo / Jason Dorday 'The development potential of the site under the zoning has been greatly enhanced by an approved Resource Consent for an eight-level [including basement] development of 177 apartments and three ground-level commercial units over approximately 18,000sq m according to the consented plans,' Bayleys said. Construction progresses at the site of the new New World Pt Chevalier on Great North Rd, Auckland. The store, developed by Foodstuffs North Island and designed by Wingate Architects, is due to open later this year. Photo / Jason Dorday The new supermarket has been set back from the street, with a partly covered walkway now being finished beside the Kumho Tyres building, short-stay parking out the front and a big underground basement for parking. Auckland Council documents describe buildings on the Hobson One site: '1150 and 1158 Great North Rd are occupied by a vehicle workshop, tyre shop and paint and panel beaters. Plans for apartments on Great North Rd beside the new $73 million New World Pt Chevalier. Photo / Auckland Council consent documents 'Built development within these lots comprises two-level industrial style buildings located centrally with a canopy extending over the forecourt in front, a double garage and electrical transformer at the rear of number 1150, and concrete/asphalt driveway and parking areas across the remainder of the land,' the council document says. A larger scheme was once planned. Consent was granted non-notified on February 20, 2023, for an eight-storey apartment block, with basement parking, three commercial units and 177 dwellings, the council noted. Derelict buildings in front of and around the New World Pt Chevalier which is planned to open in August. 22 July 2025 New Zealand Herald photograph by Jason Dorday But the market changed and now only about 50 units are planned. 'Given the changing demands of the market, the applicant wishes to achieve a similar development in terms of land use, albeit on a much smaller scale in terms of the height of the built form, but also notably the depth and volume of earthworks required will be significantly less,' the council document said. Kendyl Smith, chair of the Albert-Eden Local Board, said the site was private property which the council had boarded off. Smith was aware of safety and crime concerns. New World Pt Chevalier, Auckland nearing completion. Photo / Jason Dorday 'The council is actively working to maintain safety in and around this site, which involves working with the property owner to determine the next steps,' Smith said. The board had completed a review of crime prevention through environmental design in the wider area, Smith said. That identified safety-related improvements for Pt Chevalier. New World Pt Chevalier, Auckland nearing completion. Photo / Jason Dorday 'There are also ongoing patrols of the area from the council's community safety wardens, working with NZ Police,' Smith said. 'We're also looking forward to the new modular library, with full library services, joining the town square this October.' The New World opening would provide a welcome addition for locals and for the wider village, Smith said. Kāinga Ora has also developed new social housing in the town centre. This shows work on the block, long since finished. These are the new state homes in Pt Chevalier. Photo / Michael Craig On the corner of Great North Rd and Pt Chevalier Rd, a block of apartments was imported fully built from China. That is for people aged 55-plus moving into or from existing state housing. Kāinga Ora contracted Tawera Group and Teak Construction on this job. They assembled the 61-unit block of single-bedroom new units. Kāinga Ora said the modular homes were all one-bedroom apartments to cater for high demand for those types of places. They are single, factory-built modules. Last year, when New World Pt Chevalier was being built, and the home next door. Photo / Jason Dorday A man in his 90s is yet to find a buyer for his home next to the new supermarket. The Herald reported last year on 12 Parr Rd North. That has been in Albert John Andrews' family for 70 years. Foodstuffs said last year it had been working closely with the family, other neighbours and the community throughout the build process. Anne Gibson has been the Herald's property editor for 25 years, written books and covered property extensively here and overseas.
1News
15 hours ago
- 1News
NZ 'lucky' to have 'premium' butter as only option — Fed Farmers
Federated Farmers' dairy group chair says New Zealanders are lucky to have premium butter, but he hopes prices drop at the checkout as soon as the cost of milk solids do. The price of butter rose nearly 50% to the year ended May, Stats NZ data showed. Dairy giant Fonterra's boss Miles Hurrell sympathised with households feeling the pinch but said price increases were a reflection of supply not being able to keep up with demand. Fonterra could not offer cheaper prices to local customers, he said. Federated Farmers Dairy Industry Group chairperson Karl Dean said New Zealanders had to pay the market rate. ADVERTISEMENT "We are lucky we get a premium product as our only option... the rest of the world would love to have grass-fed butter all the time," he said. "So it is good that we have that option, but all that we ask is that when the prices come down - which they will, they always do - that flows on through the supply chain." The morning's headlines in 90 seconds, including Hulk Hogan dies, sentencing for a New Zealander who assaulted two airline stewards, and a big accolade for Te Papa. (Source: 1News) Dean believed Fonterra, wholesalers and supermarkets were doing their best to keep prices down. But they needed to react quickly when contract milk prices changed, he said.
