The latest New Zealand Treasury Monthly Economic Indicators, for January 2019 was out today
Some of the highlights:
Real GDP grew 0.3% in the September quarter, below our Half Year Economic and Fiscal Update (HYEFU) forecast. However, revisions to earlier quarters resulted in higher than expected annual average growth of 3.0%.
Early indicators for the December quarter point to a pickup in growth.
- Business and consumer confidence measures rose in the December quarter.
- Residential building consents and increases agricultural production will provide support for residential investment and exports, respectively.
Annual Consumers Price Index (CPI) inflation of 1.9%
weaker than expected at HYEFU, largely owing to a decline in petrol prices
- We expect inflation to dip in the March quarter as lower petrol prices flow through fully into tradables inflation
- However, annual non-tradables inflation is expected to continue rise gradually reflecting capacity pressures.
The IMF slightly lowered forecasts for global growth in its January World Economic Outlook Update
- downward revisions follow slower growth in recent months, most notably in the euro area
- The revisions come amid fears of an economic slowdown in China
- Uncertainty over Brexit continues to weigh on sentiment in the UK and the euro area,
- the US government shutdown is expected to reduce US GDP growth
Australian GDP slowed in the September quarter, and business sentiment fell sharply in December. House prices continue to fall in Australia, although we do not expect any flow on effects to the New Zealand property market.
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A net optimistic view from the Treasury. Link is here for much more.
