Bernard Hickey details the key news overnight in 90 seconds at 9 am in association with Bank of New Zealand, including reaction to John Key's plan announced yesterday to sell up to 50% of Meridian Energy, Genesis, Mighty River Power and Solid Energy to the public through share floats.
Business and investing industry leaders are enthusiastic, saying it will give the NZX a much needed boost and provide much better choice for individual investors and local fund managers alike.
However, the Labour opposition and unions are against the plan, saying it may lead to higher power prices and increased foreign ownership of what are essentially monopoly assets.
Our poll running shows more than 50% oppose the plan. See my view here on Key's change of view and why selling these 4 SOEs may not be financially sensible.
Meanwhile, China announced overnight new measures to crackdown on surging apartment prices and inflation generally.
China's state council has announced a tightening of land supplies for developers, it has raised sales taxes on apartments sold after less than 5 years ownership and it has raised the minimum deposit to buy second homes to 60% from 50%.
This is all designed to curb speculation in property that has thrust prices well out of the reach of Chinese workers.
Meanwhile the battle to control inflation in the developing world continues in India.
It has increased its official interest rate for the 7th time since last March this week as it struggles to control a 16.5% rise in wholesale prices and surging food prices.
Onion prices in India are up 46% and Eggplant/Aubergine prices are up 62% over the last year. See more here.
America's efforts to print more of the world's reserve currency is spilling over into inflation in the BRIC (Brazil, India, Russia and China) economies. Their reaction to this inflationary surge is well worth watching in New Zealand, given growth in China in particular is crucial to keep demand up for our commodity exports.
The New Zealand dollar was little changed overnight, although the Dow passed through 12,000 and the oil price rose a bit on views the Federal Reserve will keep printing money.
Around 8.30 am the US Federal Reserve announced it would continue with its plan to buy back bonds (money printing) and keep interest rates near zero for an extended period. This was as expected.
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