New Zealand Annual Immigration Declined in October (Update1)
By Tracy Withers
Nov. 20 (Bloomberg) — New Zealand's annual immigration growth fell to a 21-month low in October, suggesting demand for houses and consumer goods may cool.
The number of permanent migrant arrivals exceeded departures by 7,517 in the 12 months ended Oct. 31, the lowest since the year to January 2006, Statistics New Zealand said in a report released today in Wellington. The gain from annual immigration narrowed from 8,309 in September and has been falling since November last year as departures outpace arrivals.
Reserve Bank Governor Alan Bollard is combating inflation by raising interest rates to a record-high 8.25 percent this year to curb spending and slow the housing market. Falling immigration will help the central bank's cause, adding to signs that domestic demand is slowing.
“The Reserve Bank will be looking for evidence of a sustained moderation in household demand before it feels more comfortable with the domestic inflation outlook,'' said Daniel Wills, economist at ASB Bank Ltd. in Auckland. Still, “rate cuts remain a distant prospect.''
Just three of 16 economists surveyed by Bloomberg News expect a rate cut before June 30 next year. Eleven analysts see no change in rates and two see an increase before then.
Bollard last week said high borrowing costs were slowing the housing market “in quite a significant way.'' House sales fell 23 percent in October from a year earlier, according to the Real Estate Institute.
Migrant departures in the year ended Oct. 31 rose 9.9 percent from a year earlier while arrivals increased 0.6 percent. New Zealand citizens departing rose 14 percent from a year earlier to 54,053 while those returning home fell, the statistics agency said.
In October, permanent arrivals fell to a six-month low and exceeded departures by 260 seasonally adjusted. In the first nine months of the year, the average gain was about 470 migrants.
Tourist and short-term visitor arrivals fell for a second straight month in October, which may curb spending in an industry that makes up about 10 percent of the $102 billion economy.
In October, short-term visitor arrivals fell 2.6 percent, seasonally adjusted, from September when they dropped 3.4 percent. New Zealanders returning from the Rugby World Cup may have affected the number of airline seats available for overseas visitors from Europe and Asia, the agency said.
Departures rose 1.5 percent in October led by travel to France, which hosted the rugby tournament.
Arrivals increased 3.1 percent in the 12 months ended Oct. 31, the agency said, citing unadjusted figures. More than 60 percent of the annual gain came from Australian visitors while arrivals from Japan and the U.S. declined.
To contact the reporter on this story: Tracy Withers in Wellington at email@example.com .
Last Updated: November 19, 2007 17:48 EST