Economic prospects improving but risks remain

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Economic prospects improving but risks remain

The Business NZ Planning Forecast is pointing to improvement in the economy in the March quarter.

The forecast incorporates Business NZ’s Economic Conditions Index (ECI), which tracks 33 indicators including GDP, export volumes, commodity prices and inflation, debt and confidence figures.

The ECI for the March quarter is 14, up 5 from the previous quarter and up 17 from the -3 recorded for the same quarter last year.

While many indicators are improving, there is a still a balance of factors impacting positively and negatively on growth prospects.

Household budgets are still under pressure, with higher unemployment, modest wage growth and likely higher debt servicing costs later this year, although positive business employment intentions point towards significant future improvements.