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Economic indicators shining bright

NZ NewswireNZ Newswire 14/09/2016

© AFP PHOTO / ROSLAN RAHMAN It may not be called a rock star just yet, but the New Zealand economy is banging its drum quite loudly with figures due out on Thursday expected to show strong growth.

Economists expect Gross Domestic Product figures to show the economy grew by around 1-1.2 per cent in the June quarter.

BNZ estimates it will show annual growth of 3.7 per cent.

"If we are right ... (it) compares incredibly favourably with the world's economic powerhouses," head of research Stephen Toplis said in a preview.

He says the growth would far outstrip that of the US (1.2 per cent), the Eurozone (1.6 per cent) and Japan (0.6 per cent) over the same period.

"Of our major trading partners only China, Malaysia, Indonesia, the Philippines and India are expanding at a faster pace.

"Until there are clear signs that growth in New Zealand is softening it will be difficult to knock the stuffing out of the domestic currency," he said.

Manufacturing is expected to be the key stimulus for the growth with BNZ anticipating the construction sector grew by 5 per cent in the quarter.

However, it thinks the figures will be the peak of the growth cycle.

But NZ First thinks the GDP figures will paint a fake picture of the economy as the growth fails to take into account annual population growth of 2 per cent from record immigration.

"Two per cent has to be deducted from GDP numbers before any real growth can be claimed. Without this adjustment, the numbers are totally misleading.

"What matters is GDP growth per capita," said leader Winston Peters.

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