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New Zealand economic outlook

New Zealand economic outlook. Grant Spencer Reserve Bank of New Zealand September 2012. Eriksens Actuarial Auckland, 25 September 2012. Off the record please…. ...and this presentation is not financial advice. Weaker global outlook. Trading partner GDP growth (annual).

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New Zealand economic outlook

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  1. New Zealand economic outlook Grant Spencer Reserve Bank of New Zealand September 2012 Eriksens Actuarial Auckland, 25 September 2012

  2. Off the record please… ...and this presentation is not financial advice

  3. Weaker global outlook Trading partner GDP growth (annual)

  4. Financial markets supported by Central Bank actions

  5. Reflected in lower bond yields

  6. Global risk appetite is supporting NZD

  7. Which is holding back export growth Export volumes

  8. Global developments are slowing NZ’s progress • Weaker world demand and commodity prices • High NZD putting pressure on export sector • Offshore funding for banks easier but still expensive

  9. Consumption stronger but savings continue to recover Household saving rate and consumption

  10. Reflected in weak credit – strong deposits Annual bank credit and deposit growth

  11. Strong recovery in residential investment Residential investment

  12. Stronger house prices – for a period Annual house price inflation

  13. Government consolidating Fiscal impulse (share of nominal GDP)

  14. Net result: gradual recovery in GDP growth GDP growth (annual)

  15. Inflation pressures remain moderate Consumer price inflation

  16. Interest rates remain flat 90-day interest rate

  17. End of presentation

  18. Public debt overhang remains a major issue Gross government debt as percent of GDP (IMF WEO, April 2012)

  19. European bond rates:convergence -divergence

  20. Canterbury rebuild profile Canterbury rebuild profile (share of potential GDP)

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