Following the release of November month New Zealand (NZ) Net Migration data, 41,500 YoY versus 43,000 prior, Westpac came out with its analysis of how it could affect the nation’s fundamentals. The data gained importance as the Statistics NZ earlier signaled of a probable downward revision.
Key quotes
Today’s update largely confirmed what we had expected. What we are seeing is a continued easing in net migration, with the annual net inflow slowing to an estimated 41,500 in the year to November. That’s down from 43,000 in the year to October 2019, and a peak of around 64,000 in 2016.
Stats NZ has taken a closer look at peoples’ movements in and out of the country to identify whether people are coming in on a long term or temporary basis. This has revealed that fewer people entered the country on a long-term basis than earlier estimates implied, with estimates for the year to May revised down by 9,400.
Slower than expected migration and population growth will have a range of important implications for the economy. One of the most important areas that will be affected is construction.
Slower population growth will also have important implications for the retail sector, moderating an easy source of demand growth many businesses have enjoyed in recent years.
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