Economics & Markets

New Zealand Insights - March 2019

By Bevan Graham
Managing Director and Chief Economist, AMP Capital New Zealand New Zealand

Key points

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GDP growth has shifted down a gear

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Labour market tightening

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Inflation still boringly benign

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OCR cuts more likely?

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External accounts in good shape

New Zealand's GDP growth has shifted down a gear and the peak in the economic cycle is now well behind us. Growth in the second half of 2018 was disappointing, reflecting a number of economic headwinds, including a moderation in global growth and slower population growth. Rising capacity constraints will also continue to have a moderating influence on growth in activity.

But there are tailwinds too, largely on the back of fiscal stimulus and strong growth in labour income. At the same time, monetary policy remains highly stimulatory.

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Important notes

This article has been prepared to provide general information and does not constitute 'financial advice' for the purposes of the Financial Advisors Act 2008 (Act). An individual investor should, before making any investment decisions, consider the information available in the relevant Product Disclosure Statement and seek professional advice. While every care has been taken in the preparation of this document, AMP Capital Investors (New Zealand) Limited and the AMP Group (together, 'AMP') make no guarantee that the information supplied is accurate, complete or timely and do not make any warranties or representations in respect of results gained from its use. The information is not intended to infer that current or past returns are indicative of future returns. The views expressed are those of the author and do not necessarily reflect those of AMP. These views are subject to change depending on market conditions and other factors.

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