NZ: Disappointed Q2 GDP numbers, slowing momentum – HSBC

FXStreet (Delhi) – Research Team at HSBC, note that the recently released GDP numbers of NZ signals a below trend growth in the first half which is a clear indicator that the growth momentum is slowing down for the Kiwi economy.

Key Quotes

“New Zealand's GDP rose by 0.4% in Q2 to be 2.4% higher y-o-y (market had 2.5% yo-y). Growth was supported by a rebound in dairy and mining production following a falls in Q1 and ongoing growth in business services.”

“However, economic momentum has clearly slowed following last year's strong performance. For the first half as a whole, GDP growth slowed to an annualised rate of 1.3%, down from 4.7% in the second half of 2014.”

“With growth running well below trend in the first half, there are likely to continue to be weak domestic price pressures. This is not least because growth in demand has continued to be met by very strong supply. We expect another cut in the cash rate in Q4 to 2.50%.”