Unemployment rate heading higher and consumers more cautious
Inflation rate heading lower in the near term
RBNZ turns to quantitative easing
Public debt to head to over 50% of GDP
Spending needs to be directed at long-term goals
Need to prepare for the next crisis
New Zealand’s current recession is unique. It was on us very quickly and it is very deep. The June quarter of 2020 will likely see the biggest-ever quarterly decline in New Zealand’s economic activity. That reflects the pace at which everything shut down everywhere.
Furthermore, it was not born of the usual build up in economic imbalances that need to be corrected. That bodes well for the recovery, or at least its initial stages, as economic and social restrictions are lifted and life returns to some semblance of normal.
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