New Zealand is - slowly but surely - emerging from the recession, with figures showing a second successive quarter of slight growth.
Gross domestic product (GDP) figures released today showed the New Zealand economy grew slowly in the September quarter.
Statistics New Zealand said GDP rose by 0.2 per cent on a seasonally adjusted basis - the same rise it recorded for the June quarter, following five quarters of contraction.
Finance Minister Bill English was feeling mostly upbeat about the result – with a few reservations.
"While growth is still weak, today's figures are positive news. New Zealanders can go into the Christmas break feeling a bit more confident about the economy and the year ahead," Mr English said.
"Two quarters of growth - following five quarters of contraction - reflects a stabilisation in the global economy and the Government's sound economic management.
"The positive data follows Treasury's updated forecasts which show unemployment is likely to peak sooner and at a lower level than previously thought, with 64,000 fewer jobs expected to drop out of the economy.
"However the recovery remains fragile and any further problems abroad could weaken our growth prospects. That is why it is critical we improve the competitiveness of our exporters and address structural imbalances in our economy.
"To climb back up the world income ladder and to replace jobs lost during the recession we need businesses to have the confidence to invest and create jobs", said Mr English.
Financial markets were expecting September quarter growth of 0.3-0.4 per cent.
GDP contracted 1.3 per cent for the year ended September 2009.
Statistics NZ said that, in level terms, economic activity during the September quarter was 2.9 per cent lower than in the December 2007 quarter when economic activity last peaked.
"The economy continued to grow slowly in the September 2009 quarter, and the picture across industries was mixed," said Statistics NZ national accounts manager Rachael Milicich.
"On the production side of the economy, mining and business services showed the largest increases."
By industry, the largest movements were:
* real estate and business services, up 2.2 per cent, driven by business services
* mining activity, up 11.1 per cent, driven by an increase in both extraction (mainly offshore oil production), and exploration (as measured by metres drilled)
* manufacturing activity, down 1.9 per cent, and now back to the June 1999 quarter level
* construction activity, down 4.4 per cent, the sixth decrease in the last seven quarters.
The volume of spending by New Zealand households was up 0.8 per cent in the September quarter.
Spending on durable goods (big-ticket items such as furniture, appliances, and cars) was up 2.0 per cent, and spending on services also increased. Household spending on non-durables (which includes alcohol and food) fell 0.8 per cent.
Investment in fixed assets, measured by gross fixed capital formation, was down 1.8 per cent in the quarter. The largest contributors to the decline were plant, machinery, and equipment investment (down 8.0 per cent), other construction, which includes roads and bridges (down 9.3 per cent), and residential building (down 5.0 per cent).
- NZPA
