MNI 5 Things: New Zealand Q2 GDP Beats RBNZ's Projection

By Sophia Rodrigues

     SYDNEY (MNI) - New Zealand's GDP growth was stronger than expected in the

second quarter, rising 1.0% q/q and 2.8% y/y compared with MNI median forecast

for 0.8% q/q and 2.6% y/y growth, data from Statistics New Zealand published

Thursday showed.

     Below are the five key observations we made from the data:

     --GDP growth beat both MNI median forecast and Reserve Bank of New

Zealand's projection which was for 0.5% q/q and 2.3% y/y growth. Growth was

broad-based with 15 of 16 industries up.

     --Household consumption rebounded strongly in Q2, rising 0.6% q/q and 3.0%

after a flat q/q and 2.9% increase in Q1. While the y/y rise of 3.0% met the

RBNZ's forecast, the 0.6% q/q rise fell short of its projection of 0.9%.

     --Services industries was the biggest contributor to growth, rising 1.0%

q/q and accelerating from 0.6% growth in Q1. Within services, rental, hiring and

real estate service grew 0.9% q/q versus a 0.4% rise in Q1. Goods-producing

industries rebounded with a 0.9% q/q growth from a 0.1% fall in Q1. Growth in

primary industries slowed, rising 0.2% q/q in Q2 versus a 0.6% rise in Q1.  

     --Gross fixed capital formation was down 0.1% q/q and business investment

fell 0.2%. Residential construction rose 0.5%.

     --GDP per capita rose 0.5% q/q in Q2 after a flat Q1. A slowing a

population growth of 0.4% q/q in Q2 versus 0.6% in Q1 was a contributor to the

rise. For the year to June, the rise was a muted 0.7% -- the slowest in at least

six years.

--MNI Sydney Bureau; tel: +61 2-9716-5467; email: sophia.rodrigues@marketnews.com

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