Key facts
- New Zealand's economy grew 0.2% in the second quarter, exceeding forecasts.
- Annual GDP increased 2.6%, surpassing market expectations.
- Spending by overseas visitors contributed to growth in travel services exports.
- Construction activity was the largest downward contributor to GDP, falling 1.4%.
- GDP per capita was flat in the December quarter due to population growth.
New Zealand's economy expanded by 0.2% in the second quarter, a figure that exceeded analyst expectations of 0.1% growth and the Reserve Bank of New Zealand's forecast of no growth. The annual GDP increased by 2.6%, surpassing the market's expectation of a 2.2% rise. The growth was partly driven by an increase in spending by overseas visitors, which contributed to a 7.8% rise in travel services exports in the December quarter. However, construction was the largest drag on GDP, falling by 1.4% due to a decrease in non-residential building activity. GDP per capita remained flat in the December quarter as population growth matched the overall GDP increase. The data, released by Stats NZ, showed that GDP had risen in three of the last four quarters. Finance Minister Nicola Willis acknowledged the disruption from the Middle East conflict but stated the economy was in a stronger position than in previous years. Conversely, Labour's finance and economy spokesperson Barbara Edmonds criticized the 0.2% growth as a 'failure' and a long way from the 'recovery' the government has spoken about.