Did NZ drop the ball on quality assurance for its methane-measuring joint venture? (Image of MethaneSat: NASA/Supplied)
Did NZ drop the ball on quality assurance for its methane-measuring joint venture? (Image of MethaneSat: NASA/Supplied)

The BulletinJuly 10, 2025

What went wrong with MethaneSat – and who should answer for it?

Did NZ drop the ball on quality assurance for its methane-measuring joint venture? (Image of MethaneSat: NASA/Supplied)
Did NZ drop the ball on quality assurance for its methane-measuring joint venture? (Image of MethaneSat: NASA/Supplied)

New Zealand’s first publicly funded space mission has ended with a lost satellite and a debate about how we spend our money in space, writes Catherine McGregor in today’s extract from The Bulletin.

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A sudden silence in orbit

When MethaneSat lost contact last month, it marked an abrupt end to New Zealand’s first publicly funded space mission – and a major setback for local climate science. The satellite, part of an international effort led by the US Environmental Defense Fund, was designed to “name and shame” major methane polluters. As The Guardian’s Veronika Meduna explains, MethaneSat’s main focus was on detecting methane leaks from oil and gas production worldwide; the New Zealand-led side project tracked methane release from agriculture, which accounts for almost half of our greenhouse gas emissions. Meduna reports that in total New Zealand contributed NZ$32 million to the mission – $3m more than the figure widely quoted in last week’s headlines.

Apportioning blame

The questions now are less about whether MethaneSat was a good idea and more about whether its problems should have been spotted sooner. Soon after launch, the satellite faced repeated technical issues, including difficulties with its thrusters and unexpected shutdowns caused by solar activity. Nicholas Rattenbury, Auckland University associate professor of physics, points out that “the principle of caveat emptor is true for spacecraft as much as it is for purchasing a car”. While NZ was not involved in the design and testing, “we were certainly entitled to relevant information to make a fully informed decision on whether or not to invest”.

His colleague, astrophysicist Richard Easther, suggests NZ needs to shoulder some of the blame. Speaking to the Sunday Star Times’ Jonathan Killick (paywalled), Easther argues local checks on the satellite’s design and readiness were too light, especially given the “major problems” that became clear long before contact was lost. All experts seem to agree that New Zealand may have relied too much on assurances from overseas partners instead of independent reviews. It’s one of the main questions that the postmortem, when it comes, will have to answer.

Space agency under scrutiny

The MethaneSat failure has turned the spotlight on how New Zealand runs its space activities. The New Zealand Space Agency, formed in 2016 and now with Judith Collins as its minister, acts both as regulator and supporter of the sector. Simon Hunt, writing for BERL, describes it as a “one-stop shop” for space policy and business support, noting its advantage in being “not burdened down with outdated policies and processes”.

But some researchers argue this dual role can be a conflict. As UoA’s Priyanka Dhopade and Catherine Qualtrough write in The Conversation, the set-up of the agency risks “a conflict of interest between promoting sustainability and fostering economic growth”. Sustainability in space is a growing international concern, Dhopade and Qualtrough write. As the amount of debris in space continues to skyrocket (sorry), scientists are also turning their attention to emerging issues like “ozone depletion from rocket launches and the accumulation of alumina and soot particles in Earth’s atmosphere as re-entering objects burn up”.

The rise of Rocket Lab

While MethaneSat drifts in silence, New Zealand’s biggest space player is enjoying a record run. Rocket Lab – officially a US company – is now valued at over NZ$30 billion, with the share price hitting a record high of around US$38 (NZ$63). The Herald’s Chris Keall reports (paywalled) that two factors are fuelling Rocket Lab’s rise: fallout from SpaceX founder Elon Musk’s feud with Donald Trump, and the upcoming first test launch of Rocket Lab’s “much larger, crew-capable rocket, the Neutron – which will put it toe to toe with SpaceX for the first time”.

But the company’s success has also attracted protest, reports The Spinoff’s Gabi Lardies. Critics have accused Rocket Lab of enabling military surveillance, including through launches of BlackSky satellites allegedly used by Israel’s defence forces. Last Friday Rocket Lab sites were picketed, while Palestine Solidarity Network Aotearoa has referred CEO Peter Beck, Judith Collins and others to the office of the prosecutor of the International Criminal Court. Beck has dismissed the claims, insisting the company abides by New Zealand law and doesn’t launch weapons. Still, the sight of picket lines outside a NZ success story is a reminder that space, like politics, is never free from earthbound controversies.

Keep going!
Financial markets are putting the chance of a cut today at under 20%. (Image: The Spinoff)
Financial markets are putting the chance of a cut today at under 20%. (Image: The Spinoff)

The BulletinJuly 9, 2025

Why economists are betting on the OCR holding steady today

Financial markets are putting the chance of a cut today at under 20%. (Image: The Spinoff)
Financial markets are putting the chance of a cut today at under 20%. (Image: The Spinoff)

Inflation uncertainty is driving expectations that the Reserve Bank will hit pause on cash rate cuts, writes Catherine McGregor in today’s extract from The Bulletin.

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RBNZ set to keep cash rate steady

The Reserve Bank is widely expected to push pause on its series of cuts when it announces its latest Official Cash Rate (OCR) decision today. After six consecutive cuts since August last year — slashing the OCR from 5.5% to its current 3.25% — economists say the mood has shifted. ANZ’s Sharon Zollner describes the call as a “very close-run thing”, giving odds of around 40% that the bank will cut. But the consensus is that acting governor Christian Hawkesby and the monetary policy committee will leave rates unchanged for now, Newsroom’s Andrew Patterson reports. Financial markets are putting the chance of a cut today at under 20%, with a much stronger expectation that any move will come at the next review in late August.

Mixed signals cloud the outlook

As Interest’s David Hargreaves explains, the Reserve Bank faces a complex set of signals. On one hand, GDP for the March quarter outstripped forecasts, rising 0.8% – double what the RBNZ predicted in May. But more recent indicators look weaker: retail spending remains soft, business sentiment surveys are downbeat, and the unemployment rate appears to be nudging higher. Bernard Hickey points out in The Kākā that the Reserve Bank’s new “Kiwi-GDP nowcast” shows GDP falling back into recessionary territory over the last three months. (See the graph here).

Meanwhile, inflation remains stubborn in key areas like food, where prices climbed 4.4% in the year to May. Many bank economists still see annual inflation running slightly above the RBNZ’s target range of 1%–3% for the next quarter or two. “If it’s short term that’s not really a problem,” Hargreaves writes. “Where it becomes a problem is if the public starts to expect future inflation and begins to act accordingly.” For the Reserve Bank, the risk is that high prices for groceries and other essentials could reignite those dreaded “inflation expectations” – something it worked hard to rein in after inflation spiked to over 7% in 2022. That risk alone makes another cut today unlikely.

Modest gains for mortgage holders

For homeowners, the likely pause means no big drop in mortgage rates in the short term, reports Taylor Rice of 1News. Average rates have already fallen significantly as the OCR has come down: the typical floating rate now sits at 6.92%, while the average one-year and two-year fixed rates are both just over 5.6%. Infometrics’ Brad Olsen says he continues to believe that “mortgage rate cuts have largely run their course” unless the economy deteriorates further. Still, plenty of homeowners who fixed at higher rates are about to refix at these lower levels, offering some relief for household budgets.

Such a modest boost for borrowers doesn’t look set to spark a fresh housing boom. Asking prices are trending down across the main property platforms, Interest’s Greg Ninness reports. Realestate.co.nz saw a 3% drop in national asking prices last month alone, while Trade Me Property shows three straight months of declines. Combine plentiful listings with rising caution about job security, and economists see little chance of prices taking off anytime soon.

Household inflation data back this October

Meanwhile, The Post’s Kelly Dennett (paywalled) reports that Stats NZ’s long-delayed Household Living-Costs Price Index (HLPI) will finally return in October, releasing figures for the March, June and September quarters all at once. Stats NZ says “technical data-processing challenges” are to blame for the extended delay. Unlike the Consumer Price Index (CPI) – the RBNZ’s main target for monetary policy – the HLPI measures cost pressures faced by different household groups such as superannuitants, beneficiaries and Māori households. Its return will help officials get a clearer picture of who is feeling the pinch and how. A RBNZ spokesperson said it would welcome the HLPI’s return, but the pause had not compromised the bank’s ability to do its job.