Economic Weekly: There is little signal this will end quickly
- Today, the Middle East war has reached week 4. Measures taken to reroute oil proved initially successful, however, Iran is targeting energy infrastructure across the Gulf. US President Trump has voiced a variety of strategies on reopening the oil-critical Strait of Hormuz. This has ranged from requesting US allies join in, to directly threatening the destruction of Iranian infrastructure. At this stage, the Strait remains functionally closed.
- A slew of central banks met last week, with many holding interest rates steady. The current impacts of this war are difficult for central banks to disentangle, and monetary policy is a bit of a sledgehammer when you need a scalpel.It is therefore not surprising that many have chosen to hold the line and gather more information.
- Back home, the NZ economy grew 0.2% in Q4 2025. While this is backward looking, it confirms the NZ economy was a bit weaker going into the Middle East shock. Growth looks driven by agricultural or tourism-related sectors – which continues the multi-speeded recovery we have observed across regions (see our new 2025 Q4 Regional Economic Scoreboard).
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Mark Smith
Senior Economist
Mark joined ASB in 2017, with over 20 years of public and private sector experience working as an economist in New Zealand and the UK.
His resume includes lengthy stints at ANZ and the Reserve Bank of New Zealand, and he has also worked at the Bank of England, HM Treasury and the New Zealand Transport Agency. Mark's areas of specialisation include interest rate strategy, macro-economic analysis and urban economics.
Born and bred in the Waikato, Mark studied at Waikato University where he graduated with a Master of Social Sciences, majoring in Economics.
Mark's key strengths are the ability to use his extensive experience, inquisitive nature, analytical ability, creativity and pragmatism to dig a little deeper and to deliver common sense solutions to tackle complex problems.
When not at work Mark likes to travel, keep fit and spend time with his friends and family.
- Email: Mark