Peters says Luxon didn't warn him about leadership vote, Mooney denies leaking

This is less about policy substance than coalition durability, and that matters because markets price New Zealand on continuity premia, not headline ideology. The immediate risk is a late-cycle widening of intra-government bargaining costs: when partners start signaling through media, it raises the odds of delayed fiscal execution, softer reform velocity, and more ad hoc concessions to keep the arithmetic together.

The second-order effect is on the election path: NZ First can now extract value from positioning itself as the swing veto on trade, immigration, and “order” themes, which increases the probability that campaign rhetoric pulls the policy mix toward lower-growth, higher-friction outcomes. That would be mildly negative for domestically exposed cyclicals, small caps, and any rate-sensitive names that need a clean policy runway to de-risk capex.

The overread here is to assume this instantly threatens the coalition. Peters has every incentive to keep the government alive while maximizing leverage; the real tail risk is not collapse, but a more transactional cabinet where every controversial file gets repriced for survival, extending uncertainty into the next 1-2 quarters. The media fight is a signal that internal discipline is weaker than advertised, which tends to show up first in sentiment-sensitive sectors before it shows up in macro data.