NZ Budget: Likely to have a feel-good factor around the dollars and cents outlook - BNZ
Analysts at the Bank of New Zealand (BNZ) offer a sneak peek into New Zealand’s 2019 Budget due to be announced this Thursday.
Key Quotes:
“Likely to have a feel-good factor around the dollars and cents outlook.
Treasury's GDP growth forecasts will surely be curbed of their recent enthusiasm (recalling that December's HYEFU anticipated 3.1% growth for 2019 and 3.0% for 2020). However they will probably still be rosy enough to allow for sustained/increasing operating surpluses, and net debt tending to about 20% of GDP, over the next few years.
What about the government's move to a net debt target range of 15 to 25% of GDP beyond 2021/22? At one level it's all quite sensible, and so shouldn't bother anybody (including the rating agencies).
Point forecasts can often be man-made rods for one's back (witness the selfflagellation over achieving 2% CPI inflation, and occasional exercises in economic forecast "accuracy"). Even 25% net debt would still be very low by international standards.”
Author
Dhwani Mehta
FXStreet
Residing in Mumbai (India), Dhwani is a Senior Analyst and Manager of the Asian session at FXStreet. She has over 10 years of experience in analyzing and covering the global financial markets, with specialization in Forex and commodities markets.
