New Zealand economy decelerates in January-March 2008 news
27 June 2008

Mumbai: New Zealand's economy decelerated by 0.3 per cent in the first quarter of the current year, but is likely to post a minor growth in the second quarter, just evading a recession, Statistics New Zealand, a government agency, said.

New Zealand's central bank, meanwhile, forecast a 0.2 per cent growth in the second quarter, against a deceleration in the three months that ended 31 March.

Household consumption spending fell 0.4 per cent in the March quarter, with reductions in spending on motor vehicles, furniture and major appliances, the agency said.

An extension of negative growth into the second quarter would have made the New Zealand economy officially in recession.

Statistics New Zealand said this was the first decline the economy registered since the December quarter of 2005.

The decline has been attributed mainly to a 5.6 per cent fall in agriculture, sparked by drought, lower output and higher production costs, the agency said.

Despite the current contraction, gross domestic product for the fiscal year ended 31 March still grew three per cent, after growth of 0.8 per cent in the December quarter, the agency said.

The annual rate of growth was also well ahead of the 1.6 per cent growth recorded in the year to 31 March 2007, it said.

The New Zealand dollar fell to 75.35 US cents from 75.53 cents before the release of the data. 


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New Zealand economy decelerates in January-March 2008