Population growth has slowed but is still making a contribution to GDP growth
Fiscal policy will be a key support for GDP growth over 2019
Weak business confidence still a risk
Labour market remains tight
Monetary policy still on hold for the foreseeable future
The New Zealand economy continues to perform well. This is despite slowing population growth and the seemingly entrenched pessimism emanating from the business community. Annual GDP growth is still solid by mature developed economy standards but has clearly shifted down a level. The theme of capacity constrained growth continues to play out, as spare capacity is absorbed and a number of key sectors, such as construction and tourism, are at capacity. We continue to expect fiscal policy to be a key support for GDP growth over the course of 2019, though the forecast growth outlook remains largely unchanged.
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