New Zealand’s GDP rollercoaster continues after rise
New Zealand’s growth revived last quarter with a result of 1.1 per cent, but it remains a smaller economy than a year ago.
Following the announcement of a shocking negative 0.9 per cent GDP result in the June quarter, this result was revised down to one per cent from Statistics New Zealand on Thursday, with the September quarter recouping those losses.
Manufacturing and business services led this increase, with exports increasing by 3.3 percent, including rapid growth in the tourism and dairy sectors.
It’s been a bumpy year for the Kiwi economy, growing by more than one per cent in two of the last five quarters and shrinking by one per cent or more in the other two quarters.
The net effect was -0.5 percent growth for the past year, reflecting the difficult path out of the post-pandemic doldrums.
Although recent conditions can only be described as dire, the three-month result has been a tonic for Prime Minister Chris Luxon, who said at the start of the year that “driving for growth is undoubtedly the number one priority”.
Mr Luxon backed Thursday’s figures on social media, saying it meant “more jobs, higher wages and more opportunities for Kiwis”.
This doesn’t sit well with the current reality, where unemployment is at 5.3 percent, a nine-year high, and wage growth is at 2.1 percent, with headline inflation lagging behind 3 percent.
The last quarter was attributed to US President Donald Trump’s approach to trade, while global uncertainty regarding the implementation of tariffs also continued.
Through 2025, Mr. Luxon’s government has hit rock bottom in the polls, with most pollsters predicting a very close result in next year’s election.
The latest poll, published by Wellington newspaper The Post on Wednesday night, showed Labor on track to unseat the National-led right-wing coalition.
Such an outcome would be historic for New Zealand’s first single-term government in half a century and the first right-leaning government not to be re-elected in 90 years.
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