NEW ZEALAND: Q1 Retail Volumes Up More Than Forecast, Y/Y Pace Edges Higher
New Zealand Q1 retail sales volumes rose 0.8%q/q, versus a flat market forecast. The Q4 rise was also nudged a little higher to +1.0% (against an originally reported 0.9% gain). Today's print is a positive in the sense that other retail/consumer spend indicators have suggested a more adverse backdrop. In y/y terms spending was up 0.65%, a modest improvement on the 0.32% outcome seen in Q4 last year. This suggests further modest improvement in underlying spending momentum (we were at -4.04%y/y back in Q4 2023). The RBNZ meets next week and is expected cut the policy rate by 25bps.
NZ stats noted: "The biggest contributors to the rise in retail activity in the March 2025 quarter were:
- motor vehicles and parts retailing – up 3.1 percent
- pharmaceutical and other store-based retailing – up 3.7 percent
- clothing, footwear, and accessories – up 3.2 percent
- accommodation – up 2.9 percent."
Adding: "Ten of the 15 retail industries had higher retail sales volumes in the March 2025 quarter, compared with the December 2024 quarter, after adjusting for price and seasonal effects."
Want to read more?
Find more articles and bullets on these widgets:
Historical bullets
JGBS: Futures Weaker O/N, Risk-On Pressures Short US Tsys
In post-Tokyo trade, JGB futures closed weaker, -11 compared to settlement levels, after US tsys finished modestly mixed on Tuesday.
- US curves unwound a large portion of Monday's steepening, with bonds outperforming weaker short-end rates as markets reassessed tariff-tied risks to global trade and the Trump Administration's efforts to meddle with the Federal Reserve's independent policymaking.
- Unwinding of haven demand and a poor 2-year auction saw the yield close 6bps higher at 3.82%. The long end was in the green all session, and the 10-year yield was 1bp lower at 4.40%.
- Europe’s return from its extended Easter holiday improved market depth.
- Risk-on sentiment extended into today’s Asia-Pacific session after US President Trump stated that he had no intention of firing Fed Chair Powell (which has been a cause of concern recently and around the outlook for Fed Independence). Such fears had weighed on broader US asset-related sentiment.
- Trump also stated that the final tariff number for China wouldn't be near the current 145%. He also expressed optimism around trade deals with lots of countries and spoke of the large investment agreements reached for flows into the US.
- Today, the local calendar will see Jibun Bank PMIs and the Tertiary Industry Index. PPI Services is due on Thursday.
BONDS: NZGBS: Slightly Weaker, US Tsys Modestly Mixed After China & Powell HLs
In local morning trade, NZGBs are flat to 2bps cheaper, with a steeper curve, after US tsys finished mixed on Tuesday.
- US curves unwound a large portion of Monday's steepening, with bonds outperforming weaker short-end rates as markets reassessed tariff-tied risks to global trade and the Trump Administration's efforts to meddle with the Federal Reserve's independent policymaking.
- Brief midday risk-on move extended after headlines that Tsy Sec Bessent (speaking at a JP Morgan event in DC - closed to public and media) saw the China tariff standoff as unsustainable and expected a de-escalation to occur. The bloom quickly came off the rose as sources clarified the gist of negotiations would be a "slog".
- Risk-on sentiment has extended into today’s Asia-Pac session after US President Trump stated that he had no intention of firing Fed Chair Powell.
- Trump also stated that the final tariff number for China wouldn't be near the current 145%.
- Swap rates are flat to 3bps higher, with the 2s10s curve flatter.
- RBNZ dated OIS pricing is showing 27bps of easing priced for May, with a cumulative 79bps by November 2025.
- Today, the local calendar will be empty.
- On Thursday, the NZ Treasury plans to sell NZ$250mn of the 4.50% May-30 bond, NZ$250mn of the 4.25% May-36 bond.
MNI: UK JAN-MAR MEDIAN PAY AWARDS +3% :Brightmine
- MNI: UK JAN-MAR MEDIAN PAY AWARDS +3% :Brightmine
