Political & Economic week ahead: Goff kicks off mayoralty bid

Click the NBR Radio box for on-demand special feature audio: Rob Hosking gives his in-depth analysis on the big stories to watch out for this week 

Former Labour leader Phil Goff's mayoral bid kicks off the week in politics. The long-awaited announcement has now kicked off a further round of speculation, based on the questions of (1) why is everyone, especially National Party ministers from John Key on down, so keen on saying how Mr Goff is a good and useful prospect as Mayor; (2) what does Mr Goff actually stand for as mayor; (3) what will the flow-on effect be if he wins and stands down as Roskill MP; and (4) what will the flow-on effect be with any Labour reshuffle.

Labour leader Andrew Little is promising a reshuffle some time before the end of the year: leading prospects for promotion are Te Tai Tokerau MP Kelvin Davis and Auckland list MP Jacinda Ardern. Look also for former finance spokesman David Parker to be given an expanded role in the economic area, although current finance spokesman Grant Robertson will keep that senior portfolio. 

The rejig of Labour's line up will foreshadow the government's cabinet reshuffle: Prime Minister John Key has signalled this will probably come in the new year. One certain move is Trade Minister Tim Groser, whose departure has been almost as well signalled at Mr Goff's mayoral bid. 

There could be a need for a wider reconstruction in that area, though, if Foreign Minister Murray McCully's current health problems linger.  

On the economic front, the big news is today's migration statistics and what they mean for policy moves ahead. The long awaited dropoff in net immigration has not happened: in fact the figure spiked even higher, to 62,500 for the year, and with the first annual net positive inflow from Australia since 1991.

That is going to feed further into New Zealand's already loose labour market: with unemployment at 6% and rising, the pressure is on for the Reserve Bank to not just cut the official cash rate to 2.5% in December – as is now virtually a done deal – but to keep cutting into 2016.

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