NZIER Consensus Forecasts point to a slowing in growth in New Zelaand over coming years

Dhwani Mehta FXStreet

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.

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.

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