KEY POINTS:
The outlook for New Zealand's economy is still quite reasonable despite another round of interest rate hikes, the high dollar and increased fuel prices, the BNZ believes.
Tony Alexander, the bank's chief economist, said there is a lot of support for growth coming from Government infrastructure, including roads and electricity upgrading, so things should not be too bad for the next few years.
"We've simply had two or three shocks come together all at once. The jump in the currency, the Reserve Bank quite logically having to raise interest rates and of course Fisher & Paykel's announcement. We think things are still acceptable."
However, Mr Alexander does have concerns for the longer term.
He said a lack of productivity growth will make it difficult for New Zealand to climb back up the OECD income ladder for many years, but that does not mean the country cannot have a viable economy.
- NEWSTALK ZB
