Indicator Digest - CMS Forex

Gross Domestic Product

GDP is the broadest measures of the economy, encompassing every sector of the economy, such as consumer spending, business and residential investment. Increased growth relates to better corporate profits, stock growth, and eventually wages.

Main Indicator: Gross Domestic Product q/q

Most Recent Release

September
25th, 2008

Actual

Forecast

Revised Form

-0.2%

-0.5%

-0.3%

N/A

For 2nd Quarter
Provided by: Statistics New Zealand

GDP y/y: 1.0%, forecast 0.6%, pr. 2.2% (rev from 1.9% - 1Q), pr. 3.5% (4Q), 3.3% (3Q)

From the Release:

"Economic activity decreased 0.2 percent in the June 2008 quarter, following a 0.3 percent decrease in the March 2008 quarter.
In the June 2008 quarter, activity in service industries and goods-producing industries decreased 0.4 percent and 0.2 percent, respectively.
Annual growth in gross domestic product was 2.6 percent for the June 2008 year.
Gross fixed capital formation was up 2.0 percent in the June 2008 quarter.
Household consumption expenditure dropped 0.3 percent this quarter, following a 0.4 percent decrease in the March 2008 quarter.
Real gross national disposable income increased 5.0 percent for the year ended June 2008."

Table of Past Data

	6/28	9/27	12/20	3/27	6/26	9/25

Actual	1.0%	0.7%	0.5%	1.0%	-0.3%	-0.2%
Forecast	1.0%	0.5%	0.4%	0.8%	-0.3%	-0.5%
Previous	0.8%	1.0%	0.8%	0.5%	0.8%	-0.3%
Revised From	N/A	N/A	0.7%	N/A	1.0%	N/A

Past Releases

June
26th, 2008

Actual

Forecast

Revised Form

-0.3%

0.8%

1.0%

For 1st Quarter
Provided by: Statistics New Zealand

GDP y/y: 1.9%, forecast 2.1%, pr. 3.5% (rev from 3.7% - 4Q) 3.3% (3Q)

First quarter GDP contracted with a drag from agriculture and constructions sectors. Consumption and demand faltered mainly for durable goods such as motor vehicles, furnitures, and major appliances. Non-durable goods expenditure was flat. The poor figures on economic growth serve as a reminder to the RBNZ that there is no more room to hike rates even though inflation is elevated.

Highlights from the release: "Activity in primary industries decreased 4.1 percent, and goods producing industries declined 1.9 percent in the March 2008 quarter. Gross fixed capital formation was down 2.0 percent in the March 2008 quarter. Household consumption expenditure dropped 0.4 percent, following an increase of 0.5 percent last quarter. Real gross national disposable income increased 5.3 percent in the year ended March 2008."

March
27th, 2008

Actual

Forecast

Revised Form

1.0%

0.8%

0.5%

N/A

For 4th Quarter.
Provided by: Statistics New Zealand

GDP y/y: 3.7%, forecast 3.4%, pr. 3.3% (3rd Q)

The New Zealand economy in the fourth quarter last year had the highest annualized growth since 2004. Export growth played a large role in overall growth, especially that of butter, cheese and crude oil. At the moment Bollard is indicating that he will hold the OCR at 8.25% even though some slowdown in housing, and a draugh induced cut-down in farm production. He believes this is the "appropriate" level of borrowing cost. Additionally, he projected inflation to be above 3.0% this year.

December
20th, 2007

Actual

Forecast

Revised Form

0.5%

0.4%

0.8%

0.7%

For 3rd Quarter.
Official Release from Statistics New Zealand
Sept '07 GDP y/y: 2.7%

Services continue to push the economy, as goods-producing industries and manufacturing were both down. Domestic spending grew only slightly after previous three quarters of strong growth. Growth in household spending grew slower than in the previous month as well. Finally, Increased exports of petroleum products in the September 2007 quarter were offset by reduced exports of dairy products.

September
27th, 2007

Actual

Forecast

Revised Form

0.7%

0.5%

1.0%

N/A

For 2nd Quarter.

GDP y/y: 3.2%, forecast 2.6%, prev. 2.5%

Annual growth for the June quarter is revised to 2.2%, according to StatNZ. The real disposable income component of GDP increased 3.2% annually in the June quarter. This softening was shown by a reduction in volumes of imports of consumption goods, and a flat retail trade activity combined with build-up of stockpiles.

Goods-producing industries, and construction were down 0.1% and 0.8% respectively. Manufacturing was up 0.5%. Household spending also softened. Household consumption eased from 2.2% in the March 2007 quarter to 0.7% in the June quarter. Spending was proportionally carried by non-durable goods as opposed to durables, as purchases of new vehicles declined.

Investments fixed assest fell 2.9% in Q2. Government spending grew by 1.2% in the quarter. Exports volume fell 1.3% while import volumes rose 2.5%.

June
28th, 2007

Actual

Forecast

Revised Form

1.0%

0.8%

N/A

According to Statistics New Zealand, annual growth for the March 2007 year is 1.7%. Majority of growth came from services industries, which grew 1.2%. Goods-producing industries grew at 1.3% this quarter driven by 3.4% increase in retail trades activity. Household consumption expenditure also increased to 2.2% last quarter from 1.4% in Dec. 2006 quarter. Construction activity increased 2.6% due to strength in the non-residential sector.