Asia Regional Integration Center

New Zealand’s economy increased by a seasonally adjusted annualized rate of 0.9% in the first quarter of 2017. Consumption was the biggest contributor to growth, adding 3.8 percentage points. Retail sales expanded by 6.7% in the second quarter, as in the first. The seasonally adjusted performance manufacturing index declined slightly to 55.4 in July 2017 from 56.0 in June. The business confidence index dropped to 18.3 in August from 19.4 in the previous month while consumer confidence also remained positive. Inflation slowed to 1.7% in the second quarter from 2.2% in the previous quarter, still within the Reserve Bank of New Zealand inflation target of 1.0%–3.0%. The seasonally adjusted unemployment rate improved marginally to 4.8% in the second quarter from 4.9% in the first—for its best showing since 2009. Considering robust domestic demand supported by accommodative monetary and fiscal policy, as well as strong net migration, the FocusEconomics Consensus Panel projects GDP to expand by 2.8% in 2017 and 2018.s