New Zealand: Atypically long

The global crisis hit New Zealand just as it was undergoing a difficult domestic adjustment. The multiple blows of housing market correction, collapsing world trade, rising risk spreads, tighter credit conditions and unsustainably high private-sector debt suggest a recession of atypical length.

However, major policy stimulus should contribute to modest positive growth next year.

Receding inflation has enlarged the scope for monetary easing, which remains the front line of macroeconomic stabilisation. The deteriorating outlook for public finances, with high external debt, has led the government to trim the initially planned policy stimulus in its recent budget. It should realign spending with the now postponed but still desirable cuts in marginal tax rates, which would improve persistently low productivity growth.

Click here to see all OECD Observer articles on New Zealand

See also

You can order the latest Economic outlook at

©OECD Observer No 274, July 2009

Economic data

GDP growth: +0.5% Q2 2019 year-on-year
Consumer price inflation: 1.9% August 2019 annual
Trade: +0.4% exp, -1.2% imp, Q1 2019
Unemployment: 5.1% August 2019
Last update: 9 September 2019

OECD Observer Newsletter

Stay up-to-date with the latest news from the OECD by signing up for our e-newsletter :

Twitter feed

Subscribe now

<b>Subscribe now!</b>

Have the OECD Observer delivered
to your door

Edition Q2 2019

Previous editions

Don't miss

Most Popular Articles

NOTE: All signed articles in the OECD Observer express the opinions of the authors
and do not necessarily represent the official views of OECD member countries.

All rights reserved. OECD 2019