WELLINGTON: New Zealand´s economic growth slowed to a five-year low in the 12 months to June, official data released Thursday showed, fuelling expectations further interest rate cuts are imminent.
Statistics New Zealand said the economy expanded 0.5 percent in the April-June quarter, slightly below market forecasts, as mining and manufacturing activity weakened.
It took annual growth to 2.1 percent, the lowest recorded since late 2013.
Economists said the weak figures increased the likelihood the central bank will follow up a surprise interest rate cut last month with further reductions.
The reserve bank of New Zealand slashed its base rate 0.5 percentage points to a record low of 1.0 percent in August, saying it wanted to stimulate the economy in a bid to meet employment and inflation targets.
Kiwibank chief economist Jarrod Kerr said New Zealand was struggling for growth amid weak business and household confidence, combined with heightened uncertainty offshore.
He predicted the central bank would leave rates on hold next week but cut them by 25 basis points at its November meeting, with a similar reduction possible in early 2020.
However, Kerr doubted the bank could kick-start the economy by itself, saying the government needed to boost spending to provide "fiscal caffeination".
"What´s needed, is a strong fiscal policy," he said. "Monetary policy is proving ineffective without fiscal support."
"This would be final review of SBA, and staff level agreement is expected after this appraisal," says finance ministry
A commercial bank in Karachi has reportedly received Rs1,000 notes that were misprinted
BML Capital terms new finance minister a “solid guy” to put country on reform path
During intraday trading, PSX plunged by over 1,000 points and made slight recovery before its closing
US has witnesses a rise in prices of homes that is a reason to make homeowners happy as their home equity is increasing
Better Business Bureau has sounded the alarm that 67,000 crypto scams have been reported