NZ economy: stop-go signs ahead

14 Dec 2021

The BusinessNZ Planning Forecast looks into unchartered territory as Covid-19 continues to affect the economy.

The Forecast for the December 2021 quarter indicates that New Zealand is not likely to see as strong an economic upswing as predicted at the beginning of the August lockdown, and that economic effects of Covid-19 are likely to be felt well into 2022.

“International borders still closed in early 2022, and isolation requirements on international visitors are likely to further affect tourism, hospitality and other service sectors.  Meanwhile, inflationary pressures, supply chain disruptions and labour shortages all point to an economy likely to be held up by stop-go signs,” BusinessNZ Chief Executive Kirk Hope said.

The BusinessNZ Economic Conditions Index currently sits at 8 for the December 2021 quarter, up 13 on the previous quarter and down 1 on a year ago, an unsurprising result given the move to L4 lockdown in late August for the entire country which significantly affected economic activity.

The BusinessNZ Economic Conditions Index tracks 33 economic indicators including GDP, export volumes, commodity prices, inflation, debt, and business and consumer confidence.

The BusinessNZ Planning Forecast for the December 2021 quarter is on www.businessnz.org.nz