A new analysis from Infometrics shows that high inflation and a large current account deficit could present economic hurdles to the incumbent government retaining power in the general election.
The Infometrics Misery Index suggests a more challenging economic environment for the incumbent government to retain power, with one of the worst changes in inflation observed in the last half-century.
The Infometrics Misery Index examines the changes in economic trends in the most recent electoral cycle and helps determine how these changes might influence voting perceptions. Usually, more extensive economic changes would suggest an incumbent government would be retained, and worse economic changes would suggest the incumbent is removed.
Overall, changes in economic trends over the 2020 to 2023 period have seen a moderate score of 0.6, a weakly positive result within the +5 to -5 range in the Misery Index. The moderate overall score highlights various economic outcomes in the last few years.
The complete analysis from the Misery Index can be viewed here.
Although the aggregate Misery Index score is positive, the result has one of the more comprehensive ranges in scores. Despite various sides of the political divide either glossing up or drumming down economic trends, the reality shows that economic outcomes have been decidedly mixed.
The high cost of living has been ranked as the most critical issue for New Zealanders in several public polls.
Infometrics analysis shows that, since June 2020, average household costs (excluding mortgage repayments) have increased by around $240 per week, according to average household spending and the consumer price index (CPI).
