NZ Budget: Sees 2021 GDP at +2.9% vs. HYEFU +1.5%

New Zealand’s (NZ) Finance Minister Grant Robertson presented the annual Budget for this year, with the Budget predicting higher growth and lower unemployment rate going forward.

Key takeaways (via Reuters)

NZ sees 2021 operating surplus before gains, losses NZ$-15.127 bln (HYEFU NZ$-21.576 bln)

NZ sees 2022 OBEGAL surplus/deficit NZ$-18.409 bln (HYEFU NZ$-16.449 bln)

NZ sees 2023 OBEGAL surplus/deficit NZ$-9.486 bln (HYEFU NZ$-10.258 bln)

NZ sees 2021 net debt 34.0 pct of GDP (HYEFU 39.7 pct)

NZ 2021 cash balance NZ$-25.277 bln (HYEFU -40.177 bln) NZ 2022 cash balance NZ$-39.232 billion.

NZ sees 2021 GDP +2.9 pct (HYEFU +1.5 pct).

NZ net debt seen peaking at 48% of GDP in 2023; reduces to 43.6% of GDP in 2025.

NZ unemployment rate is seen at 5.2% in 2021; to fall back to 4.2% by 2024.

NZ Finance Minister Robertson says the long-term effects of pandemic not as severe as previously thought.

Weekly benefit rates lifted by between NZ$32 and NZ$55 per adult.

Market reaction

The Budget had little to no impact on the Kiwi dollar, as NZD/USD kept its downside consolidation phase intact around 0.7170, almost unchanged on the day.