Get the latest retailer news on the New Zealand economy and merchant business in our monthly Retailer News. Each issue covers a range of topics, including merchant service updates, credit card fraud, and economic commentary from BNZ Chief Economist Tony Alexander.
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In the latest Retailer News
October 2018, see previous articles
Tony’s Take – Economic commentary from BNZ Chief Economist Tony Alexander
Traditionally, one of the key reasons for a collapse in confidence in the retailing sector has been a hike in interest rates. Higher borrowing costs make people especially reluctant to buy expensive items like furniture, electrical appliances, and motor vehicles. Maybe one-day retailers will face such a threat to activity levels. But for now, the opposite is happening.
We have just seen a round of interest rate cuts from BNZ, in the absence of any official easing of monetary policy by the Reserve Bank. The cuts have been driven by lower wholesale borrowing costs which have fallen in response to continued low inflation signs and the risk that some businesses act on their high pessimism and reduce investment and hiring.
We are doubtful that these two areas will be much impacted by the high level of pessimism, but the fact remains that low inflation is producing newly low interest rates and these will tend to underpin consumer spending on large items, including houses, going forward.
Read more in the latest Retailer News PDF 53KB October 2018
If you have any questions, or need some help, please contact our EFTPOS & Internet Merchant Sales and Services team on 0800 737 774, Option 4.
Previous Retailer News articles