Bernard Hickey details the key news overnight in 90 seconds at 9 am in association with Bank of New Zealand, including news the Dominion Post is reporting from an unnamed source that AMI Insurance has run out of capital and has come to an arrangement with the government to continue operating.
A spokesman for Bill English's office told Interest.co.nz the Treasury and the Reserve Bank of New Zealand was watching the situation closely, but would not confirm that a bailout was immiment. See Alex Tarrant's article here.
Regular readers will know Interest .co.nz have been following the AMI story closely.
Here's Amanda Morrall's March 11 article questioning AMI's capital strength
And here's our March 24 article reporting AM Best's credit rating downgrade
See all our AMI coverage here.
Meanwhile, Portugal has formally asked its partners in the eurozone for a bailout, potentially worsening the European Sovereign Debt crisis. See more here at Bloomberg.
Further turmoil in the financial markets makes it more difficult and expensive for the New Zealand government and its banks to roll over and raise debt on international credit markets.
Meanwhile, the gold price hit a record high of US$1,463/ounce overnight on fresh talk of recovery and inflation pressures. See more here at Bloomberg.
The New Zealand dollar rose to a pre-earthquake high of 78 USc as inflows from government borrowing and quake reinsurance threaten to hit NZ$35 billion over the next year.
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