NZ economy set to keep on trucking
SHARON ZOLLNER, CHIEF ECONOMIST, ANZ NZ | JUNE 2019
New Zealand’s economy is set to keep on trucking, according to an indicator from ANZ Research, with signs pointing to a floor in growth around the middle of 2019 – before a return to good times by the end of the calendar year.
The ANZ Truckometer index rose in May, with expansion in both the Heavy Traffic and Light Traffic indexes. The movement is consistent with ANZ Research’s expectation economic growth will bottom out in the coming months.
The Light Traffic Index (cars, vans) gives a six-month lead on the direction of the economy. After two-consecutive monthly increases, annual growth in the Light Traffic Index may have found a floor, suggesting the decline in annual gross domestic product growth may soon have run its course.
ANZ Research is indeed expecting annual growth to pick up from the middle of the year but less aggressively than predicted by both the Reserve Bank of New Zealand and Treasury.
“ANZ Research is indeed expecting annual growth to pick up from the middle of the year but less aggressively than predicted by both the Reserve Bank of New Zealand and Treasury.”
The Heavy Traffic Index rose 0.8 per cent in June, while the Light Traffic Index grew 0.9 per cent. In level terms, both the Heavy Traffic Index and the Light Traffic Index are pointing upward at present, reflecting ongoing growth in the size of the New Zealand economy – and its population.
Sharon Zollner is Chief Economist at ANZ NZ
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