GDP in New Zealand
New Zealand - GDP
Growth picks up in Q2
The economy gained momentum in Q2, according to data released by the Statistical Institute on 21 September. It expanded 0.8% on a seasonally-adjusted quarter-on-quarter basis, above Q1’s revised 0.6% expansion (previously reported: +0.5% quarter-on-quarter) and in line with analysts’ expectations. On an annual basis, GDP growth was 2.5% in Q2, matching Q1’s figure. Although Q2’s reading is undoubtedly positive news for the economy, it can be partly attributed to a favorable base effect, as growth in H1 was dampened by poor weather and disruptions linked to the aftermath of the 2016 Kaikoura earthquake. By historical standards, Q1’s reading was fairly average, and the economy remains constrained by several factors, including a shortage of skilled labor and slower credit growth. GDP growth per capita was tepid at 0.3%, reflecting soft productivity growth.
The expansion in the second quarter was driven by strong growth in the service sector (Q2: +1.0% qoq; Q1: +0.5% qoq). The retail, trade and accommodation, and transport, postal and warehousing sub-sectors performed notably well. The manufacturing sector grew at a reasonable pace (Q2: +1.8% qoq; Q1: +1.2% qoq) thanks to greater food production, while the construction sector contracted due to lower residential and non-residential investment (Q2: -1.1% qoq; Q1: -2.1% qoq). In addition, mining activity fell quarter-on-quarter, while agricultural output was flat.
Looking ahead, the economy will continue to grow at a solid pace, supported by loose monetary policy, higher disposable incomes and solid prices for key commodities. However, weak productivity growth and capacity constraints will limit growth potential.
FocusEconomics Consensus Forecast panelists expect the economy to grow 2.9% in 2018 and 2.7% in 2019.
New Zealand - GDP Data
|Economic Growth (GDP, annual variation in %)||2.6||2.2||3.4||2.5||3.1|
5 years of economic forecasts for more than 30 economic indicators.
New Zealand GDP Chart
Source: Statistics New Zealand and FocusEconomics calculations.
New Zealand Facts
|Bond Yield||2.96||-1.17 %||Oct 16|
|Exchange Rate||0.72||0.06 %||Oct 16|
|Stock Market||3,731||0.02 %||Oct 16|
Get a sample report showing all the data and analysis covered in our Regional, Country and Commodities reports.
Start Your Free Trial
Start working with the reports used by the world’s major financial institutions, multinational enterprises & government agencies now. Click on the button below to get started.
October 12, 2017
The Westpac-McDermott Miller consumer confidence indicator dipped from 113.4 points in Q2 to 112.4 points in Q3, thus remaining comfortably above the 100-point threshold that separates optimism from pessimism.
September 26, 2017
Economic sentiment among New Zealand businesses took a nosedive in September.
September 21, 2017
The economy gained momentum in Q2, according to data released by the Statistical Institute on 21 September.
August 31, 2017
Economic sentiment among New Zealand businesses weakened in August.
August 10, 2017
At its meeting held on 10 August, the Reserve Bank of New Zealand (RBNZ) met market analysts’ expectations by keeping the Official Cash Rate (OCR) steady at a record low of 1.75%, where it has been since November 2016. The Central Bank’s latest decision reflects its cautious stance against a backdrop of pervasive uncertainty abroad, slower economic activity at home and subdued inflation.