Gross Domestic Product (GDP) data for the quarter to June 2024 reinforces how an extended period of high interest rates has meant tough times for families, businesses, and communities, but recent indications show the economy is starting to bounce back, Finance Minister Nicola Willis says.
Stats NZ data released today shows GDP fell 0.2% for the June 2024 quarter.
“Today’s GDP data confirms what we already know – that the economy has been suffering the after-effects of a long cost of living crisis, with the Reserve Bank having to keep rates high to tackle inflation.
“But the New Zealand economy is resilient, and it will recover. Forward-looking data shows the work we are doing to rebuild the economy is already having an impact and green shoots of recovery are coming through.
“Difficult conditions for households are also starting to ease. Inflation is forecast to be under 3 per cent this quarter, signalling an end to the extreme price increases New Zealanders have experienced over many years.
“In August, the Reserve Bank cut the official cash rate by 25 basis points – the first reduction since 2020. That is great news for businesses and for households with mortgages, providing much needed cost-of-living relief.
“Some businesses are feeling a lot better about the future with business confidence recently reported as the highest in a decade. It’s pleasing to see many businesses have the confidence to hire, invest and grow once again.
“Brighter days are ahead. There is still more work to do, but our careful and deliberate plan is laying the foundations for economic recovery,” Nicola Willis says.