NZIER Consensus Forecasts: A Sluggish Economy for the Coming Year

Overview

New Zealand's economic outlook for the coming year is looking sluggish, according to the latest NZIER Consensus Forecasts. The forecasts, which are based on a survey of economists, predict that the economy will grow by just 1.2% in 2023, down from 2.2% in 2022.

Factors Contributing to the Slowdown

Several factors are contributing to the expected slowdown in economic growth. These include: - The global economic slowdown, which is expected to reduce demand for New Zealand's exports. - The rising cost of living, which is putting pressure on household budgets and reducing consumer spending. - The impact of the COVID-19 pandemic, which is still causing disruptions to supply chains and businesses.

Implications for Businesses and Households

The expected slowdown in economic growth will have implications for businesses and households alike.

Businesses may need to reduce investment and hiring plans, while households may need to tighten their spending to cope with the rising cost of living.

Government Policy Options>

The government has a number of policy options available to mitigate the impact of the economic slowdown. These include: - Providing financial support to businesses and households - Investing in infrastructure and other projects to create jobs - Implementing policies to reduce the cost of living

Conclusion

The NZIER Consensus Forecasts suggest that the New Zealand economy is facing a challenging period ahead. However, the government has a number of policy options at its disposal to help mitigate the impact of the downturn and support businesses and households.