Liam Dann: How to read an economic forecast

It can be overwhelming trying to keep track of all the new outlooks and numbers this year. Photo / 123RF

Opinion

As we say goodbye to 2020 and welcome in 2021, it's a good time to catch up on the very best of the Herald columnists we enjoyed reading over the last 12 months. From politics to sport, from business to entertainment and lifestyle, these are the voices and views our audience loved the most. Today it's the top three from Liam Dann.

A guide to economic forecasts

There's been a flurry of new economic forecasts over the course of this year. It's been overwhelming just trying to keep track of all the new outlooks and numbers.

The analytics suggest a lot more people read articles about economic forecasts when the economy gets interesting.

Unfortunately, the more interesting the economy is the more difficult it is to forecast.

If there's one thing we can all agree on it's that the economy is very interesting right now.

That doesn't mean we should ignore forecasts. They need to be read in context but they remain an important guide.

So on that note, here is a guide, to reading them.

No economist claims to actually know what the future holds. Photo / 123RF

Are low interest rates good or bad for poor people?

Do low interest rates help or hurt poor people?

It's a contentious question right now.

Traditionally it was a bit of a no-brainer.

Making money cheaper is supposed should help those at the lower end of the social spectrum - as long as it doesn't cause undue inflation.

But the extent to which low rates boost house prices has dominated discussion in the past few years.

This year, in the shadow of the Covid-19 pandemic, the unexpected surge in house prices has created an almost singular focus on low interest rates as the cause of inequality.

Middle-class panic has put heat on interest rates but what's the impact on real poverty?

The surge in house prices has put a focus on low interest rates as the cause of inequality. Photo / File

Eight reasons NZ is in good shape to get through this

Back in April things looked particularly bad for the New Zealand economy.

But, taking it for granted that New Zealand was facing enormous challenges in the months ahead, Liam Dann took a look at the things we did have going for us.

Why? Because we needed to stay strong and focused on getting through this period so we could start to rebuild.

This year has been grim, and may be for a while, but NZ has some big things going for it.

This year has been grim, and things may continue to be for a while, but New Zealand has reasons to be cheerful. Photo / File