Arab Today, arab today plunge in dairy prices prompts warnings for new zealand economy
Last Updated : GMT 18:08:03
Arab Today, arab today
Arab Today, arab today

Plunge in dairy prices prompts warnings for New Zealand economy

Arab Today, arab today

Arab Today, arab today Plunge in dairy prices prompts warnings for New Zealand economy

Plunge in dairy prices
Wellington - XINHUA

Dairy prices plunged to a six- year low on Thursday, prompting warnings of hard times ahead for the New Zealand economy and forecasts of drastic interest rate cuts.

The fortnightly Fonterra-run GlobalDairyTrade auction saw the average price for New Zealand's main export commodity fall by 5.9 percent, taking down about 57 percent from last year's peak prices.

An Economic Note issued by the ASB Bank forecast the central bank would take a total of 75 basis points over three cuts to the official cash rate (OCR), currently at 3.25 percent, by the end of this year.

The dairy price plunge was one of a number of recent developments that "point to the risks of weak growth if the RBNZ ( Reserve Bank of New Zealand) doesn't reduce the OCR significantly further," said the note.

Previously analysts had expected the RBNZ to shave another 25 basis points off the OCR this year after dropping it from 3.5 percent last month.

However, the note said, business confidence had fallen across all sectors, the agricultural sector was facing a "drastic" decline, and growth in business activity looked set to slow in the second half.

Only the falling New Zealand dollar and accelerating credit growth that was fueling a "red hot" housing market could temper the RBNZ's cuts in the OCR.

The ASB Bank and other commentators said weakening demand in China, New Zealand's biggest market for whole milk powder, along with a global dairy glut was driving down dairy prices.

The main opposition Labour Party said falling dairy prices would create a growing "economic black hole" of at least 13 billion NZ dollars (8.71 billion U.S. dollars) and drive many farmers and supporting industries out of business.

"This latest fall comes on the back of business confidence turning negative for the first time in four years, stubbornly high unemployment, declining job advertisements, falling wage and employment confidence and a precipitous drop in exports," Labour finance spokesperson Grant Robertson said in a statement.

The opposition Green Party said a Treasury "downside scenario" to falling commodity prices, issued with the budget in May, was coming to bear.

"If Treasury's downside scenario is coming true, New Zealand can expect a blow-out in the current account deficit and nominal GDP (gross domestic product) 26 billion NZ dollars (17.42 billion U.S. dollars) lower than forecast out to June 2019," Green Party co-leader James Shaw said in a statement.

"Treasury also predicts further trouble for the government's books as a result of low dairy prices and low farmer incomes, including higher government debt and a delay in returning to surplus until June 2018."

Name *

E-mail *

Comment Title*

Comment *

: Characters Left

Mandatory *

Terms of use

Publishing Terms: Not to offend the author, or to persons or sanctities or attacking religions or divine self. And stay away from sectarian and racial incitement and insults.

I agree with the Terms of Use

Security Code*

Arab Today, arab today plunge in dairy prices prompts warnings for new zealand economy Arab Today, arab today plunge in dairy prices prompts warnings for new zealand economy

 



Arab Today, arab today
Arab Today, arab today Fadi explains secrets of  Nancy Ajram's newlook

GMT 18:23 2017 Friday ,24 February

Fadi explains secrets of  Nancy Ajram's newlook
Arab Today, arab today Messi visit will contribute in tourism

GMT 14:04 2017 Friday ,24 February

Messi visit will contribute in tourism
Arab Today, arab today Expresses Algerian history by woody figures

GMT 13:26 2017 Friday ,24 February

Expresses Algerian history by woody figures
Arab Today, arab today Iran complying with nuclear deal

GMT 07:14 2017 Saturday ,25 February

Iran complying with nuclear deal
Arab Today, arab today Zainab al-Maliki reveals herTV presenter models

GMT 18:12 2017 Friday ,24 February

Zainab al-Maliki reveals herTV presenter models

GMT 12:30 2017 Friday ,24 February

Norway's Telenor to leave Indian telecom market

GMT 10:17 2017 Friday ,24 February

Dow stands out as global stocks tread water

GMT 16:11 2017 Thursday ,23 February

Bahrain Bourse daily trading report

GMT 16:08 2017 Thursday ,23 February

BHB holds VAT seminar

GMT 13:40 2017 Thursday ,23 February

Muscat Securities Market loses 17 points

GMT 13:18 2017 Thursday ,23 February

Bahrain Bourse daily trading report

GMT 05:51 2017 Thursday ,23 February

Saudi stocks edge up as Brent futures rebound
View News in Arabic - Business: أسواق مالية
Arab Today, arab today
Arab Today, arab today
Arab Today, arab today Reading therapy relieves mental disorders

GMT 15:39 2017 Friday ,24 February

Reading therapy relieves mental disorders
Arab Today, arab today UK appoints 1st Scotland Yard chief in 188 years

GMT 05:14 2017 Thursday ,23 February

UK appoints 1st Scotland Yard chief in 188 years
Arab Today, arab today Penguins in the age of dinos

GMT 11:44 2017 Saturday ,25 February

Penguins in the age of dinos
Arab Today, arab today Pluto's unruly moons

GMT 06:31 2015 Thursday ,04 June

Pluto's unruly moons
Arab Today, arab today 'Constructive' Vauxhall talk with union

GMT 08:54 2017 Saturday ,25 February

'Constructive' Vauxhall talk with union
Arab Today, arab today Tesla back into red but revenue grows

GMT 07:27 2017 Thursday ,23 February

Tesla back into red but revenue grows
Arab Today, arab today Actress Lobna Abdel Aziz proud of her career

GMT 06:08 2017 Thursday ,23 February

Actress Lobna Abdel Aziz proud of her career
Arab Today, arab today Ex-yoga missionary unleashes rage

GMT 12:16 2017 Thursday ,23 February

Ex-yoga missionary unleashes rage

GMT 07:36 2017 Wednesday ,22 February

Wafaa Amer is happy for Sherihan’s return

GMT 12:35 2017 Tuesday ,21 February

63-Year-Old Woman Delivers Baby

GMT 22:42 2017 Thursday ,23 February

Nasima Gamei revives heritage in jewelries

GMT 10:28 2017 Wednesday ,22 February

Milan laughs while Rome cries

GMT 20:33 2017 Friday ,17 February

To release new antiques collection

GMT 10:20 2017 Thursday ,23 February

Brazil's top diplomat resigns

GMT 09:59 2017 Monday ,20 February

Tourism shows signs of recovery

GMT 13:12 2015 Saturday ,09 May

Sheikh Sultan opens Sharjah Centre

GMT 20:02 2017 Tuesday ,21 February

Nohan Seyam designs beautiful accessories
Arab Today, arab today
Arab Today, arab today
 
 Arab Today Facebook,arab today facebook  Arab Today Twitter,arab today twitter Arab Today Rss,arab today rss  Arab Today Youtube,arab today youtube  Arab Today Youtube,arab today youtube
arabstoday arabstoday arabstoday arabstoday
arabstoday arabstoday arabstoday
arabstoday
بناية النخيل - رأس النبع _ خلف السفارة الفرنسية _بيروت - لبنان
arabstoday, Arabstoday, Arabstoday