The Country 18/11/25: Cameron Bagrie talks to Jamie Mackay

Is an Independent Economist who comments on the state of a precarious world economy. Plus we preview next week's OCR announcement from the Reserve Bank. 

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Episode Transcript

Speaker 1 (00:00):
Cameron Bagri Independent economist. America is very much at the
forefront of our minds economically in this country, because one
man on this planet is dominating proceedings more than anyone else.

Speaker 2 (00:12):
Trump, Eh, what do you reckon?

Speaker 3 (00:14):
Well, he is. It's not just about Donald Trump. There's
an awful lot of political geo strategic tension here between
our biggest trading barner that's China and there are seventeen
billion dollar market in the United States is nine point
five And at the moment we've lived in this low volatility.
We called it the era of the Great Moderation over

(00:36):
the nineteen nineties, the sort of two thousands where the
world played reasonably nice. It feels like at the moment
geo political get strategic considerations at the forefront. The economics
of trade is a lot more about security of trade,
security and regard to food security and energy security and
technological advancement i e. The Chips. And there's a bit

(00:59):
of a ding dong come on around the globe at
the moment, and New Zealand's trying to play a little
in Switzerland in the middle.

Speaker 1 (01:05):
Yeah, well, we are going to be chatting to Stefan
Vogel shortly about this geopolitical tension between the US and China.
It's sort of the Cold War revisited, isn't it. But
let's just stick to the domestic front here at this stage,
because we're going to have a look at the global
outlook with him Cameron Vagri. We've got an official cash
rate announcement, the final one for the year next week.

(01:28):
Everyone seems to be an agreement or are they that
we get another twenty five basis points and that's our lot.

Speaker 3 (01:36):
Yeah, I think it's one and done. Yeah. What we're
now starting to see is what the data is turned. Yeah,
so it doesn't matter whether you look at ours worked,
whether you look at the export numbers. Building sense are
still low, but they're directly heading up off a low
base track. The sales are on the up, your traffic

(01:57):
volumes around the country. We're getting a pre prey consistent
message at the moment, but the economy's not knocking the
ball out of the park. There's still pockets of weakness
out there. The South Island's better than the North Island,
Auckland and Wellingon sort of at the back end of
the pack in regard to what's going on. But you know,
you got an economy that's turning in the corner. Interest

(02:19):
rates in regard to fixed mortgage rates, people are still
going to benefit from that for anotherice of twelve months.
I don't think there's any reason at the moment for
the Reserve Bank to be over the aggressive at this point,
because let's not forget yeah Jamie, he'd gone. Inflation's got
back up to three percent, and the targets too.

Speaker 1 (02:35):
I don't want to steal Stephan Vogel's I want to
keep my powder dry for him? Should I say? I
don't want to steal his march on this one. But
in their report, they're talking about global GDP growth two
point nine percent this year, but it eases to two
points seven percent in twenty twenty six. That's probably in
contrast to what's going to happen to the New Zealand economy.

Speaker 3 (02:59):
Yeah, well, we got beaten up a lot more than
the global economy. New Zealand's had GDP are capital, which
is population adjust The growth has fallen by five percent
in the past three years, which is already knocking this
stuff out of your economy and knocking the stuff and
at a living standards yea at the same time, you've

(03:20):
seen other economies around the globe. You're some of the
big players.

Speaker 2 (03:24):
Know.

Speaker 3 (03:24):
The United States has been rocking and rolling for the
past thu a couple of years, your march into their
own tune. At the same time, China has been going
pretty well. There's debate here over whether the data is right.
You've got India that's been marching online to a six
to seven percent growth numbers. Your Europe has struggled as well.
Australia has been down on the dumps as well. So

(03:45):
you've got a bit of a two tiered economy. But
if you I guess, if you sit back to look
at the bigger picture, if I go back ten to
fifteen years, your global growth used to be up around
three point five percent, So a number round two point
nine to two point seven that face fed he still
looks pretty good, but it's well below the averages of

(04:06):
what we've been used to the International Monetary Fund's chief economists,
you may use the phrase. I think it was about
six to twelve months ago she talked about dissatisfied populations
and one of the things that's driving there is that
as global growth is less fast or a little bit slower.
It's actually driving a lot of fragmentation division to what's

(04:27):
called the political periphery around the globe. And when you've
got drive into the political periphery the far left and
the far right, well what's.

Speaker 2 (04:34):
Out hey really quickly to finish on.

Speaker 1 (04:36):
And were you surprised by that recent survey that came
out I think earlier this week that marked the government
at three point nine out of ten, but more importantly
marked labor as being the most capable of sorting out,
for instance, cost of living in the economy. That's the
normal domain of the NATS.

Speaker 3 (04:56):
Yeah. Well, if I go back and have a lock
at the twenty twenty three our September version of the
Epsossi's Monitor, what we got from that in twenty twenty
three was that the National Party was assessed, i think
off the top of the head as best able to
handle eight of the top ten issues and fifteen of
the top twenty. If you look at the scoreboard at

(05:16):
the moment, the National Party of the top twenty has
got two hits. Ie their assess has been able to
handle two issues out of the top twenty. It's like
a red smallas board. And what we've got up there
at the moment, and what that's telling you, Jamie is
that there is a right move to change across this
economy and your cost of living is just ruthless. It

(05:39):
is hurting families out there. You've got housing, you've got healthcare,
and the big flipper at the moment is it the
National Party is the top dog status in regard to
being assessed has been best able to handle the economy
and that I suspect will be a little bit of
soul such that's going on behind the scenes in regard
to what sort of message that is sending.

Speaker 2 (05:58):
Cameron Bagri there. Im an economist