NZ: Winning the growth battle - BNZ

Stephen Toplis, Head of Research at BNZ, suggests that they are expecting the week ahead to furnish yet more evidence that the New Zealand economy is ticking over very nicely.

Key Quotes

“The primary point of focus will be Thursday’s GDP release for the second quarter. We expect this to reveal that the economy expanded 1.2% over the quarter. That’s 4.9% annualised and 3.7% higher than the level of activity reported for June 2015.

If we are right, New Zealand’s 3.7% annual growth reading compares incredibly favourably with the world’s economic powerhouses. For example, over the same period, the US economy grew 1.2%; Japan 0.6% and the Eurozone 1.6%. Of our major trading partners only China, Malaysia, Indonesia, the Philippines and India are expanding at a faster pace. Given this, it’s not really surprising that offshore folk want to put money into New Zealand, in turn supporting the New Zealand dollar. In this regard it is a sanguine reminder that until there are clear signs that growth in New Zealand is softening it will be difficult to knock the stuffing out of the domestic currency.”