The one cloud on New Zealand’s economic horizon

New Zealand’s economy is set to grow strongly over the coming year, but there is one potential challenge that could cause problems for the Reserve Bank.

The Reserve Bank of New Zealand expects real GDP to grow at a steady pace of about 3 per cent until the end of 2016, according to a Monetary Policy Statement released earlier today. Long-term sustainable growth has been supported by steady increases in business investment, strong growth in the labour force and improved productivity growth.

New Zealand GDP and potential output growth (annual)

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