NZIER Consensus Forecasts point to a slowing in growth in New Zelaand over coming years
|The latest New Zealand Institute of Economic Research (NZIER) Consensus Forecasts showed a downward revision to economic growth for the year to March 2023, followed by a slowing in growth over the subsequent years.
Additional takeaways
Annual average GDP growth is forecast to slow to 0.6 percent in the year to March 2024 before picking up to 1.4 percent in 2025.
Although demand in the New Zealand economy remained resilient for most of 2022, recent developments point to signs of a softening in demand and an easing in capacity pressures.
Forecasts of household spending have been revised lower from 2024.
Disruptions from the severe weather events and the continued softening in dairy exports have weighed on the short-term export outlook.
The inflation outlook has been slightly revised down for the year ending March 2025. Annual CPI inflation is forecast to ease to 3.9 percent in 2024 before easing to 2.4 percent in 2025.
Although near -term expectations for NZD TWI remain unchanged, forecasts for the subsequent years have been revised lower.
The NZD is expected to track between 71.1 and 71.8 on the TWI over the years 2024 to 2026.
Market reaction
NZD/USD is holding lower ground on the above outlook report from the NZIER. The pair is trading at 0.6120, erasing entire gains so far.
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