Video | Agriculture | Confidence | Economy | Energy | Employment | Finance | Media | Property | RBNZ | Science | SOEs | Tax | Technology | Telecoms | Tourism | Transport | Search

 


March 2014 Monthly Economic Indicators

The March Monthly Economic Indicators (MEI) was published today on the Treasury Website at 2:00pm. The report provides a summary of recent economic events.

The main points:
• Real GDP grew by a robust 0.9% in the December 2013 quarter, and the current account deficit narrowed sharply.

• All signs remain consistent with the economy maintaining significant momentum in the first half of 2014.

• International economic data were broadly positive, despite financial market jitters


This month’s Special Topic looks at the issue of New Zealand’s trade concentration, particularly in light of China’s rise in importance as a trade partner in recent years.

Read more at: http://www.treasury.govt.nz/releases/2014-03-31

--

Executive Summary

Real GDP grew by a robust 0.9% in the December 2013 quarter, and the current account deficit narrowed sharply.

All signs remain consistent with the economy maintaining significant momentum in the first half of 2014.

International economic data were broadly positive, despite financial market jitters.

The two major data releases for the December quarter confirmed previous signs of a strong end to 2013 for the economy. Real production GDP grew by 0.9% from the September quarter and by 3.1% from a year ago, with a continuing broad-based pick-up in activity. Meanwhile, the current account deficit narrowed markedly, to 3.4% of GDP, driven by a surge in dairy export volumes.

All signs remain consistent with the economy maintaining an above-potential pace of growth in the first half of 2014. Confidence in the business sector remains buoyant: the ANZ’s Business Outlook measure reached its highest level since March 1994 in February and other indicators remain rooted in expansionary territory too. It is a similar picture in the household sector as well. Westpac’s seasonally-adjusted consumer confidence measure hit a nine-year high in the March quarter and there are clear signs of a pick-up in discretionary spending.

Ongoing increases in net inward migration flows will also continue to add to aggregate demand in the near term. The Reserve Bank indicated that the 25 basis point increase in the Official Cash Rate (OCR) in March is likely to be the start of a 200 basis point rise over the next couple of years. With interest rates in most developed economies expected to remain at record lows for another year at least, the trade-weighted exchange rate reached a post-float high in the middle of March.

Looking slightly further out, we expect GDP growth to ease somewhat towards the end of the year and into 2015, but to remain at a robust pace. The elevated exchange rate will continue to weigh on exchange-rate sensitive sectors too (not least by further constraining spending by tourists). Meanwhile, the combined 10% fall in global dairy prices over the past three fortnightly auctions is a reminder that dairy prices can go down as well as up.

International economic data from the past month were mostly positive, although credit risks in China and developments in Ukraine caused some volatility in financial markets.

This month’s Special Topic looks at the issue of New Zealand’s trade concentration, particularly in light of China’s rise in importance as a trade partner in recent years.


© Scoop Media

 
 
 
 
 
Business Headlines | Sci-Tech Headlines

 

Taxing Multinationals: EU Ruling Sours Apple

Shares of Apple slid, down 0.9 percent as of 3.08pm in New York, after the European Commission ruled that Ireland granted the company undue tax benefits of up to 13 billion euros (US$14.5 billion)—"illegal aid” under EU rules that the commission says Ireland now must recover from Apple. More>>

ALSO:

NZX Review: Best Practice Code Recommends Code Of Ethics

NZX, the sharemarket operator, is seeking feedback on proposed changes to its corporate governance best practice code including a published code of ethics, rules about share trading and continuous disclosure, and more transparency over board appointments and chief executive pay. More>>

ALSO:

Auditors:

Signs Of Life? SETI On Russian Space(?) Signal

A star system 94 light-years away is in the spotlight as a possible candidate for intelligent inhabitants, thanks to the discovery of a radio signal by a group of Russian astronomers... Could it be a transmission from a technically proficient society? At this point, we can only consider what is known so far. More>>

Post-Post: Brian Roche To Step Down As NZ Post CEO

Brian Roche will step down as chief executive of New Zealand Post in April 2017, having led the state-owned postal service's drive to adjust to shrinking mail volumes with a combination of cost cuts, asset sales, modernisation and expansion of new businesses. More>>

ALSO:

Company Results: Air NZ Rides The Tourism Boom With Record Full-Year Earnings

Air New Zealand has ridden the tourism boom and staved off increased competition to deliver the best full-year earnings in its 76-year history. More>>

ALSO:

New PGP: Sheep Milk Industry Gets $12.6M Crown Funding

The Sheep - Horizon Three programme aims to develop "a market driven, end-to-end value chain generating annual revenues of between $200 million and $700 million by 2030," according to a joint statement. More>>

ALSO:

Get More From Scoop

 
 
 
 
 
 
 
 
 
Business
Search Scoop  
 
 
Powered by Vodafone
NZ independent news