KEY POINTS:
Economic growth in Auckland has fallen short of the national result for the December quarter as house sales and employment fell, according to the latest National Bank regional trends survey.
National economic activity grew by 0.7 per cent in the December quarter, bouncing back from a 0.3 per cent drop in September.
The survey showed that 12 out of 14 regions monitored recorded growth with Taranaki coming top on 3.3 per cent, compared to Auckland on only 0.2 per cent. Only Bay of Plenty and Gisborne were ranked lower than Auckland with activity declining by 0.1 per cent and 0.6 per cent respectively.
National Bank economist Steve Edwards said Auckland reflected the national trend.
"Unfortunately for Auckland the drop in September was a bit larger than the nationwide drop and the rebound was smaller in December," Edwards said.
Performance in regions such as Auckland and Wellington - where growth was 0.6 per cent - had more emphasis on activity in the metropolitan areas and sectors including the housing market, he said.
House sales rebounded in many regions but numbers were down in Auckland and Wellington by 4.2 per cent and 3 per cent respectively.
Employment in Auckland fell by 0.9 per cent, although nationally it was up 1.1 per cent and unemployment improved in most regions.
Retail sales recorded a small rise nationally, although consumer confidence fell in every region except Canterbury.
Private car registrations were down in most regions and dwelling approvals dropped across much of the country.
However, commercial building permits were up nationally and business confidence rose in every region except Bay of Plenty.
Year on year economic growth slowed from 2.7 per cent in September to 2.6 per cent in December, with the second half of 2007 slowing compared to the first half of the year, growing only 0.3 per cent.
"Touch wood that sort of pointing towards a soft landing rather than a hard landing," Edwards said.
"The economy's been steaming along on one of the longest growth phases since the Second World War and it's slowing down from that," he said. "It depends how fast it slows how much it's going to dent the economy."
The National Bank was predicting growth, although slowing, would remain positive at about 1-1.25 per cent annually.
There much debate about the coupling, or not, of the New Zealand economy to events in the United States, Edwards said.
"We've got a lot more of a tie with what's happening in Asia and to that regard we're a little bit more insulated," he said.
"Certainly if Europe gets sucked down the vortex that the US is following we won't be insulated at all and it would just be a matter of time, when rather than if."
DECEMBER ECONOMIC QUARTER
AUCKLAND
Economic activity up 0.2 per cent.
House sales down 4.2 per cent.
Employment down 0.9 per cent.
Residential approvals down 10 per cent.
NORTHLAND
Economic activity up 1.8 per cent.
Employment down 0.4 per cent
House sales down 20 per cent.
WAIKATO
Economic activity up 0.4 per cent.
Employment up 3.4 per cent.
House sales up 4.5 per cent.
Large farm sales up 9.4 per cent.
BAY OF PLENTY
Economic activity down 0.1 per cent
Employment down 5.2 per cent
Real estate sales up 1.5 per cent
Commercial consents down 8.1 per cent.
NEW ZEALAND
Economic activity up 0.7 per cent.
Employment up 1.1 per cent.
Consumer confidence down in every region, except Canterbury.
Business confidence up in every region, except Bay of Plenty.