NZ First, Labour to form coalition government - Westpac

Michael Gordon, Research Analyst at Westpac, explains that after several days of negotiations, NZ First party leader Winston Peters has announced that he will seek to form a coalition government with the Labour Party, which marks the end of nine years of government led by the National Party.

Key Quotes

“Labour and NZ First together have 55 of the required 61 seats in Parliament, so will require the support of the Green Party to reach a majority. The Greens were not directly involved in the negotiations, but are expected to provide a supply and confidence agreement.”

“No policy positions have been formally announced yet. However, in the press conference Peters stated that his decision was based on which party would best protect the economy during what he sees as a looming downturn. Infrastructure, regional development and social housing are likely to feature.”

“Other likely areas of policy change are around migration, foreign ownership of assets, and the Reserve Bank’s policy targets.”

“The New Zealand dollar fell from 0.7100 to 0.7060 after the announcement, and has fallen by about a cent over the course of the day.”