NZ: Total construction activity rose by 0.4% – Westpac
Satish Ranchhod, senior economist at Westpac, notes that New Zealand’s total construction activity rose by 0.4% in the June quarter, below Westpac’s and market forecasts.
Key Quotes
“Underlying the soft headline result was a fall in residential construction centred on Auckland. That’s likely to be a temporary pause with forward indicators still firm. Non-residential construction rebounded as expected.”
“Total construction activity rose by 0.4% in the September quarter. That was lower than our forecast for a 2.5% rise or the average analyst forecast for a 1% increase.”
“The main reason for the soft September quarter result was a 1.1% decline in residential building activity. That decline was centred on Auckland (where nominal spending on construction was down 3.6%) and Canterbury (down 2.5%). Spending in other parts of the country actually rose by 3.6%.”
“The trend in residential building activity has flattened off in recent years. However, we expect to see continued increases over 2020.”
“In contrast, non-residential construction rebounded as expected in September, rising by 2.4%. That was underpinned by strong activity in Auckland, with gains also seen in other areas.”
“Looking ahead, we expect to see continued strength in construction activity over 2020 and 2021.”
Author
Sandeep Kanihama
FXStreet Contributor
Sandeep Kanihama is an FX Editor and Analyst with FXstreet having principally focus area on Asia and European markets with commodity, currency and equities coverage. He is stationed in the Indian capital city of Delhi.
