GDP in New Zealand

New Zealand GDP | Economic News & Forecasts

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

2012  2013  2014  2015  2016  
Economic Growth (GDP, annual variation in %)2.6  2.2  3.4  2.5  3.1  

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New Zealand GDP Chart


New Zealand GDP
Note: Annual variation of gross domestic product (GDP) in %.
Source: Statistics New Zealand and FocusEconomics calculations.

New Zealand Facts

ValueChangeDate
Bond Yield2.96-1.17 %Oct 16
Exchange Rate0.720.06 %Oct 16
Stock Market3,7310.02 %Oct 16

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