The latest Business New Zealand Planning Forecast shows middling growth for New Zealand’s economy between now and 2025, with a mix of positive and negative indicators.
Business New Zealand Director of Advocacy Catherine Beard said New Zealand’s economy faced similar conditions to others worldwide.
"Economic growth the world over is expected to be modest over the next few years, as countries and consumers start to focus inward,” said Beard.
"In New Zealand, inflationary pressures remain elevated despite increased net migration. Although this should take some pressure off the labour market, household spending is increasingly restrained.”
Beard continued that house prices appeared to have bottomed out, but as households fix at new rates, sometimes much higher than they were initially tested, the cost of living continues to rise.
With an election on the horizon, Beard said investors were cautious. Policy announcements from all parties will play a significant role in spending in the lead-up to October.
The Business New Zealand Economic Conditions Index sits at minus one for the June 2023 quarter, a deterioration of seven from the previous quarter but an improvement of four from the previous year.
The Index tracks 33 economic indicators, including GDP, export volumes, commodity prices, inflation, debt, and business and consumer confidence.
