Liam Dann: NZ Herald business editor at large on the Reserve Bank raising issues with Stats NZ data

The Reserve Bank is urging the Government to take a hard look at Stats NZ, with a view to improving the timeliness and accuracy of key economic data.

The department has been put under the microscope, with the central bank highlighting dramatic revisions to GDP (gross domestic product) as one of the reasons for a controversial reversal in its rate track in 2024.

NZ Herald business editor at large Liam Dann explains further.

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Episode Transcript

Speaker 1 (00:00):
Right now. The Reserve Bank is taking issue with the
quality and also the quantity of stats New Zealand data.
This has come out of the Reserve Bank wash up yesterday.
Liam dan Is, The Herald's Business editor at large. Hey,
lium Yay, Ryan, what's going on here?

Speaker 2 (00:13):
Yeah, it's interesting. I mean the Reserve Bank is being diplomatic.
They're not saying that it's a failing of the stats
in z basically you know that they still work out
and everything, but they're basically calling for more funding and
sort of more focus on the core economic data. So
they point to the big GDP revision late last year,
which effectively said the economy was in much better shape

(00:36):
over the period twenty twenty three than we thought as
one of the reasons for the misstep or u turn
or whatever that they didn't make the change in the
policy direction that sort of people picked up on between
May and August. There's one of the reasons that they

(00:57):
highlighted there. So this came through yesterday and again in
the Select Committee this morning. They're saying our stats just
aren't up for purpose. Really, they're saying there's six months
out of date and often mismeasured. Was the quote, but.

Speaker 1 (01:10):
Do other countries not operate on the similar numbers because
and as they're not more high you know, the high
frequency data that they like to talk about from lots
of different sources in New Zealand that the central banks
should be looking also.

Speaker 2 (01:24):
Yeah, so they're saying they're having to look more closely
at the high frequency stuff, which is like your performance
and manufacturing and all this sort of stuff. But it's
the trouble that the more high frequency it is, the
less you know, absolute it is in terms of giving
us good, strong signals. And yeah, internationally they get inflation

(01:47):
data once a month, and a lot of places they
get GDP once a month and they break down the
GDP and look, we're a small country, so I suppose
we don't have the resource, but we're also a small
country in terms of what we measure. And when you
think about how important this is, like if if it's
if there's a misalignment between the monetary policy based on

(02:08):
understanding where economy is, it can cost billions of dollars,
as we've seen over the last few years. Now, I'm
putting aside the fact that a lot of people there
are critics out there who'll say that this sounds like
excuses or whatever from your bank. Regardless, I think it's
an area that you know, we can't lose. And if
the government doesn't have a lot of money to do

(02:28):
to look at the funding on this, perhaps they should
be looking at some of the prioritization of where status
puts its focus, because they have had a number of
years of sort of broadening their focus under the previous government.
Well being and things like that, looking at a wide.

Speaker 1 (02:43):
Range of nonsense stuff.

Speaker 2 (02:45):
Well, yeah, look, I had a look. There isn't that
much nonsense stuff, but there is a lot of qualitative stuff,
stuff that gives us a nice breakdown of how inflation
falls within different social groups and different you know, all
the different groupings. It's nice to see that and it
can help help with policy setting for inequality and all
that sort of stuff. But really, at the core, you know,
we need to get the basics right, and that's maybe

(03:07):
where we're not leading the world like we should be.

Speaker 1 (03:10):
Yeah. Interesting, surely there's some at one day and there'll
be an AI thing that will just take care of
it all.

Speaker 2 (03:16):
I can never decide whether I'm scared of the AI.
I just wanted to move faster and actually start getting
it all.

Speaker 1 (03:20):
Right loomed and New Zealand Hell business edits are at large.
Thanks so much for your time. For more from Heather
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