NZ: Annual growth to average 2.5% over the next couple of years - ANZ

According to the latest economic outlook of analysts at ANZ, New Zealand’s annual growth is likely to average 2.5% over the next couple of years.

Key Quotes

“While this is still a respectable pace of expansion (given it’s off a high base), inflation pressures are not expected to intensify in this environment. Gradually tightening credit conditions, owing to confirmed and probable changes to bank capital requirements, add to an already lengthy list of headwinds the economy is expected to face (and in large part, is grappling with already).”

“We see the case for OCR cuts becoming more evident in time, and have pencilled the first in for November. However, we acknowledge that the path ahead may not be a straight one, with market pricing ebbing and flowing with the data (the solid print for Q4 non-tradables inflation last week comes to mind).”