By the close of business, there should be a reasonable view of:
• The plight of the dairy sector.
• The state of the labour market and its likely impact on both the real economy and prospective inflation.
• Reserve Bank governor Graeme Wheeler's views on the New Zealand economy.
BNZ markets economist Stephen Toplis said most attention would be on Mr Wheeler's on-the-record speech to the Canterbury Employers Chamber of Commerce.
The speech would start at 1pm and the full speech and press statement would be released at that time.
''Given the surprising dovishness of the Reserve Bank at its January official cash rate review, there will be more than usual interest in this speech as it provides the opportunity to put flesh on the bones provided in the OCR review.''
The BNZ expected Mr Wheeler to trawl through the various issues confronting the New Zealand economy and reiterate his stance there was no reason to be contemplating rate increases given the economy was at present in a ''broadly deflationary phase'', he said.
What would be interesting for markets would be any clues on the probability of the central bank lowering interest rates.
''We think that probability is low and certainly much lower than the 90% chance by year's end the market is now pricing in.''
The combination of excess domestic demand and the falling currency meant the probability of a rate hike in the next 12 months was substantially greater than that of a cut, Mr Toplis said.
There would be more information on the state of the domestic economy with today's employment data. But the 4c a litre increase in petrol pump rices was a reminder the falling New Zealand dollar would feed through into the domestic price structure quickly.
The employment data for the three months ended December and the year ended December were expected to further affirm the strength of the economy and the growing tightness in the labour market, he said.
The BNZ was forecasting a 0.9% increase in the numbers employed in the fourth quarter to produce annual growth of 3.1%.
Overall, whatever the specifics, the composite labour market outlook should reveal an economy that did not warrant a rate cut anytime soon.
However, contrarians would probably gain some ammunition with this morning's GlobalDairyTrade auction, which should further support conjecture the dairy payout would go lower yet, Mr Toplis said.
The optimists would hang on to the fact the auction should provide more evidence prices had at least reached a trough.
Yesterday's QV release reinforced the view the housing market was building up strength - a view that would be reinforced by the inevitable reduction in mortgage rates after last week's ''softly, softly'' approach by the Reserve Bank, he said.
Today
• GlobalDairyTrade auction should show milk solid prices have reached a trough.
• Reserve Bank governor Graeme Wheeler is likely to say there is no reason for a rise in the official cash rate from 3.5%.
• Unemployment expected to stay at 5.4%, or drop only slightly to 5.3% in December as migrants and people wanting to work fill vacancies.
• Wage inflation could be 2% in December figures and well above 2% in March.
