Bay propelled up economic scoreboard

Retail trade in the Bay has grown by 7 per cent across the year, the third highest rise in the country.

A jump in retail spending and house prices have boosted the Bay of Plenty to fourth equal in the latest economic scoreboard.

The ASB regional economic scoreboard for the June quarter ranked the region fourth equal with Otago behind Canterbury, Auckland and Tasman. The Bay was in the middle of the 16 regions in the previous quarter's report.

ASB senior economist Chris Tennent-Brown put the Bay's big improvement down to the strength of the housing and retail sectors.

Retail trade had grown by 7 per cent across the year, the third highest rise in the country. The annual increase in house prices was also third in the nation at 4.4 per cent.

"Most areas were seeing house sales down by more than a year ago but by that measure the turnover in Tauranga looks a little more balanced and house prices are still going up in Tauranga," Mr Tennent-Brown said.

Auckland's strong population growth and Canterbury's earthquake repairs put them streaks ahead but the Bay was performing well in comparison to the rest of the country which was in a more normal economic cycle.

"It's just a regular period of healthy economic growth," he said.

Population and employment rates had increased slightly during the quarter but needed attention, Mr Tennent-Brown said.

"They are pointing in the right direction. It'd just be nice to see a little bit of acceleration in some of the areas like employment growth and population growth."

The labour market was crucial as it was the creation of jobs that kept people coming to an area, he said.

Tauranga Chamber of Commerce chief executive Dave Burnett said the region's success on the scoreboard was great news for the economy.

"It just shows what we're actually doing in the region."

The head of research at Craigs Investment Partners in Tauranga, Mark Lister, said the results reflected what he was seeing and hearing in the region.

"It does feel like things are certainly picking up. We're obviously certainly still well behind Auckland and Canterbury in terms of activity but we are certainly lifting from the reasonably subdued level from the last few years," he said.

Annual economic growth in the Bay

*Population: 0.3%
*Employment: 1%
*Retail trade: 7%
*House prices: 4.4%
*Construction: 14%
*New car sales: 22%