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

 

Scoop Business: RBNZ Keeps OCR At 3.5%, Signals Slower Pace Of Future Hikes

Reserve Bank governor Graeme Wheeler kept the official cash rate at 3.5 percent and signalled he won’t be as aggressive with future rate hikes as previously thought as inflation remains tamer than expected. The kiwi dollar fell to a seven-month low. More>>

ALSO:

Weather: Dry Spells Take Hold In South Island

Many areas in the South Island are tracking towards record dry spells as relatively warm, dry weather that began in mid-August continues... for some South Island places, the current period of fine weather is quite rare. More>>

ALSO:

Scoop Business: Productivity Commission To Look At Housing Land Supply

The Productivity Commission is to expand on its housing affordability report with an investigation into improving land supply and development capacity, particularly in areas with strong population growth. More>>

ALSO:

Forestry: Man Charged After 2013 Death

Levin Police have arrested and charged a man with manslaughter in relation to the death of Lincoln Kidd who was killed during a tree felling operation on 19 December 2013. More>>

ALSO:

Smells Like Justice: Dairy Company Fined Over Odour

Dairy company fined over odour Dairy supply company Open Country Dairy Limited has been convicted and fined more than $35,000 for discharging objectionable odour from its Waharoa factory at the time of last year’s ”spring flush” when milk supply was high. More>>

Scoop Business: Dairy Product Prices Decline To Lowest Since July 2012

Dairy product prices dropped to the lowest level since July 2012 in the latest GlobalDairyTrade auction, led by a slump in rennet casein and butter milk powder. More>>

ALSO:

SOE Results: TVNZ Lifts Annual Profit 25% On Flat Ad Revenue, Quits Igloo

Television New Zealand, the state-owned broadcaster, lifted annual profit 25 percent, ahead of forecast and despite a dip in advertising revenue, while quitting its stake in the pay-TV Igloo joint venture with Sky Network Television. More>>

ALSO:

Get More From Scoop

 
 
Computer Power Plus

Standards New Zealand

Standards New Zealand

Mosh Social Media
 
 
 
 
 
 
 
 
Business
Search Scoop  
 
 
Powered by Vodafone
NZ independent news