Gareth Vaughan details the key news overnight in 90 seconds at 9 am in association with Bank of New Zealand including news that the Government will today outline options for homeowners with insurance in some of the Christchurch suburbs worst affected by the earthquakes there over the past 10 months.
The announcement, due at 1.30 this afternoon, is expected to offer home owners in some of the worst affected areas the opportunity to sell their houses at 2007 values and sign their insurance policies over to the Government. See more here at the NZ Herald. The idea is that this means the home owners can cash up and leave, with the Government to recoup the payout on the property from insurers.
The plan is expected to cost at least hundreds of millions of dollars and involve 5000 homes in six of the worst-hit suburbs being Bexley, Avondale, Horseshoe Lake, Burwood, Dallington and Avonside. See more here at Stuff. Those in the Port Hills and Lyttelton are likely to have to wait for their homes to be assesed for damage from the June 13 aftershocks.
Meanwhile, the US Federal Reserve’s Open Market Committee has left its benchmark interest rate in a range of zero to 0.25%, a record low. Chairman Ben Bernanke repeated the pledge to keep interest rates at record lows for an extended period, which he suggested would be at least another two or three meetings. See more here at Bloomberg.
In its quarterly projections the Fed cut its growth projections both for this year and next year. It said the US economy should grow between 2.7% and 2.9% this year, down from a 3.1% to 3.3% projection in April. And it predicted 2012 growth in a 3.3% to 3.7% range, down from April’s prediction of 3.5% to 4.2%. See more here at Reuters.
The Fed blamed a recent slowdown in growth and quickening of inflation partly on "transitory factors", such as higher commodity prices and supply chain disruptions from Japan's devastating earthquake and tsunami in March. The Fed’s US$600 billion bond buying programme, or Quantitative Easing II, is due to end this month.
The New Zealand dollar’s recent strong run continued overnight, hitting 50.70 British pence. That’s its highest level against the pound since the New Zealand dollar was floated in 1985.