New Zealand Probably in Recession, Treasury Says
Written on August 4, 2008
New Zealand's economy probably contracted in the second quarter, pushing the nation into its first recession in 10 years, according to the Treasury Department.
“Following recent data releases, we consider the economy contracted in the June quarter, its second successive quarterly decrease,'' the department said in a report posted on its Web site today.
Drought, a housing slump and soaring credit and fuel costs have crimped consumer spending and business profits, helping the $104 billion economy contract 0.3 percent in the first quarter. Reserve Bank Governor Alan Bollard last month cut interest rates for the first time in five years, saying economic growth continues to slow payday loan low fee.
“The decline in business activity is one factor leading us to consider that gross domestic product fell for a second consecutive quarter,'' the Treasury said. “Domestic demand has weakened and private consumption is expected to have fallen in the quarter.''
Growth in 2008 could be as little as 0.5 percent from 3.1 percent last year, it said. The report doesn't contain detailed forecasts.
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