Kerre Woodham: Do you believe things are getting better?

Before I came upstairs to work, I called into the coffee shop downstairs, as is my want. Coffee Theory is run by a husband and wife family team and is a small business.  We were talking about the fact that Christopher Luxon will be in tomorrow, and I said “have you got a question?” And Penny said “When will things get better? I know they're supposed to be, but when will things get better? I just wish they'd get better faster”. And that's kind of what we were talking about in the wake of the polls showing the Coalition party support slipping. People do believe things are getting a bit better, but they want it to happen faster. 

Perhaps with the OCR falling by 50 points, as was widely expected by economists, things will start to look up. The floating rates dropped, some banks have dropped their loan term interest rates. And although the floating rate is more directly affected by the OCR, the long-term loan interest rates that are set by the banks are affected by other things like term deposits, and world events, and the like. Banks have been put on notice by Finance Minister Nicola Willis and Reserve Bank Governor Adrian Orr to sharpen their pencils, and they've been told in no uncertain terms to come up with better rates for their customers. 

“The banks need to do better. They need to look at their own margins and chase and compete for customers much more vigorously. Their funding costs are being challenged because, you know the official cash rate is only one of the variables that go into what they have to pay when they're borrowing money to on-lend, but the margin is also sitting there at a very healthy level, so one would hope that when the competition, when people come back to the market, which they're doing in dribs and drabs now, competition is alive.” 

That was Adrian Orr on the Mike Hosking Breakfast. And it is true. Once mortgage rates have been set, or loans have been set, and the interest rate for borrowing that money is a little bit lower, then there isn't as much that you have to pay, so there's a little bit leftover in your back pocket once the bills have been paid. And thus, the noose around the necks of so many homeowners and business owners will start to loosen.  

Already, some sectors have recovered, come back from the very brink. Federated Farmers says farmer confidence has risen to its highest level in more than a decade, rebounding from record lows. It couldn't have got much worse for our farming communities. Remember that lovely man that rang in? I can't even remember how long ago... he was the first caller, and he spoke with such passion and with such heartfelt pain about the despair so many farmers felt as the result of being vilified for what they did. For being on the receiving end of legislation that made it nigh impossible to do their job, and yet without them, we would be completely and utterly and royally stuffed. But he was too fearful of saying what he did. Rather than saying proudly, I’m a farmer, he just didn't feel he could say that. He didn't have any confidence at all that he would get a fair or civil reception. And that prompted an avalanche of calls from those in the farming community, young and old, who felt very much the same.  

So when they say it was at record lows, I heard it. Now, they say farmer confidence has risen to its highest level in more than a decade. The latest Farm Confidence survey shows that falling interest rates, rising incomes, and more favourable farming rules have played a major role in the improvement. And they say that's a significant shift in the mood of rural New Zealand. Thank heavens for that and not before time. Hopefully farmers can take a big deep breath, you might actually be getting some sleep at night and you can look forward to the future with a little bit of confidence.  

What other sectors are seeing that – it just farming? Is tourism fe

Episode Transcript

Speaker 1 (00:06):
You're listening to the Kerry Wood of Morning's podcast from
News Talks. He'd be before I.

Speaker 2 (00:12):
Came upstairs to work. I called into the coffee shop downstairs,
as is my want, just the one coffee a day,
but one I really look forward to, and that's beautifully
made by the coffee shop downstairs. Our husband and wife team,
not one of the big chains, you know. They are
a husband and my family team that operate the cafe downstairs.

(00:37):
I like the Happy Kiwi and Silverdale or coffee. This
is coffee theory. They're just a little family owned business.
You'll have your favorite and your town near you. But
we were talking about the fact that Christopher Luxen will
be in tomorrow. This time tomorrow, I'll be talking to

(00:58):
Christopher Luxon and hopefully you will be too, if you've
got your question ready for him, and said I was
coming in and I said, if you got a question,
Hey said, when will things get better? I know they're
supposed to be, but when will things get better? I
just wish they'd get better faster. And that's kind of
what we were talking about. In the wake of the

(01:20):
polls showing the coalition parties support slipping people do believe
things are getting a bit better, but they want it
to happen faster now, perhaps with the ocr falling by
you know, five points as was widely expected by economists.

(01:45):
With fifty points. Sorry, yeah, things will start to look
up immediately. The floating rates dropped, some banks have dropped
their loan term interest rates, and although the floating rate
is more directly affected by the OCA, the long term

(02:11):
loan interest rates that are set by the banks are
affected by other things like term deposits and world events
and the like. Banks have been put on notice by
the Finance Minister Nicola Willison this morning by Reserve Bank
Governor Adrian or on the mic Costking Breakfast to sharpen
their pencils, and they've been told in no uncertain terms
to come up with better rates for their customers.

Speaker 3 (02:33):
The banks need to do better. They need to look
at their own margins and chase and compete with customers
much more vigorously. Their funding costs are being challenged because
you know, the official cash road is owning one of
the variables that go into what they have to pay

(02:54):
when they're borrowing money to on lend, but the margin
is also sitting there at a very healthy level. So
one would hope that when the competition, when people come
back to the market, which they're doing in drums and
drabes now, competition is alive.

Speaker 2 (03:13):
Yes, that was adrenal talking to Mike Costking this morning
on the Mike Costing Breakfast. And it is true once
mortgage rates have been set or loans have been set,
and the interest rate for borrowing that money is a
little bit lower than there isn't as much that you
have to pay, so there's a little bit left over
and your back pocket once the bills have been paid,

(03:34):
and thus the noose around the necks of so many
homeowners and business owners will start to loosen. Already, some
sectors have recovered come back from the very brink. Federated
Farmers says farmer confidence has risen to its highest level

(03:56):
in more than a decade, rebounding from record lows. It
couldn't it got much worse for our farming communities. Remember
that lovely man that rang in, goodness, I can't even
remember how long ago he rang in, who was the
first caller, and he spoke with such passion and with

(04:20):
such heartfelt pain about the despair so many farmers felt
as the result of being vilified for what they did,
for being on the receiving end of legislation that made
it nigh impossible to do their job. And yet without
them we would be completely and utterly and royally stuffed.

(04:44):
But he was too he was too fearful of saying
what he did. Yeah, what do you do for a crossmate?

Speaker 3 (04:52):
Oh?

Speaker 2 (04:53):
You know better this than that, rather than saying proudly
I'm a farmer and I've been a farmer for years,
and my dad was a farmer, and his mom and
dad before. He just didn't feel he could say that.
He didn't have any confidence at all that it would

(05:15):
he would get a fair or civil reception, and that
prompted an avalanche of courts from those in the farming community,
young and old, who felt very much the same. So, yeah,
when they say it was at record low's, I heard it.
You heard it if you heard that show. Now they

(05:36):
say farmer confidence has risen to its highest level in
more than a decade. The latest Farm Confidence survey shows
that falling interest rates, rising incomes, and more favorable farming
rules have played a major role in the improvement, and
they say that's a significant shift in the mood of
rural New Zealand. So thank heavens for that, and not

(05:59):
before time. Hopefully farmers can take a big, deep breath.
You might actually be getting some sleep at night and
you can look forward to the future with a little
bit of confidence. What other sectors are seeing.

Speaker 1 (06:12):
That?

Speaker 2 (06:14):
Is it just farming? Is tourism feeling the same kind
of confidence, the same optimism. I imagine for retailers, you
might need to wait for the flow and effect of
lower mortgage interest rates, but I'd be really interested to
see where you are in terms of your confidence, in

(06:35):
terms of your belief that things are getting better and
that things will be better in the short term, within
the next six months, that things will be looking up.
The farmers are feeling it, They're feeling confident. They've seen
what lower interest rates and reasonable fair legislation can do.

(07:02):
What about you?

Speaker 1 (07:04):
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