High migration continues

There was a record net gain of 58,300 migrants in the year to June 2015, according to the latest Statistics New Zealand data.

In June 2015 there was a seasonally adjusted net gain of 4,800 migrants, which was down slightly from the 5,100 migrants who arrived in May 2015.

Net migration has now been fluctuating around this level for 11 months - and it peaked at 5,500 in January 2015.

Population statistics manager Vina Cullum said the increased net gain of migrants in the June 2015 year was driven by both more arrivals and fewer departures.

“Migrant arrivals continued to reach new highs (115,700) and were up 15% from the June 2014 year, while migrant departures (57,400) were down 8%.”

Westpac senior economist Felix Delbruck said net immigration is showing no serious sign of slowing just yet.

He expects that net migration will start to slow as the year progresses, but at a gradual pace.

“Reconstruction activity in Canterbury is at a peak and the wider New Zealand economy has come off the boil, which will in time make New Zealand a less attractive destination for migrants.”

However, Delbruck said that Australia isn't yet a compelling alternative destination, with households across the Tasman still very downbeat around job and earning prospects.

The numbers will make little difference to the Reserve Bank's determination to cut the OCR on Thursday, he continued.

“Not only have other economic data been overwhelmingly arguing in favour of a lower OCR, but the Reserve Bank has increasingly been highlighting the role of migrants in easing labour market pressures, rather than boosting demand.”