NZ: GDP firm with upward revisions

Research evidence excerpt

NZ: GDP firm with upward revisions

J P M O R G A N Economic Research

18 June 2026

NZ: GDP firm with upward

revisions

NZ GDP matched strong JPM/consensus expectations in 1Q, at 0.8%q/q. There Australian and New Zealand Interest

were also material upward revisions that leave annual growth at 1.5%oya, which Rate Strategy

is 0.5%-pt above consensus and 0.3%-pt above the RBNZ's forecast. Recall 4Q had Ben K Jarman

been curiously soft relative to the tracking inputs and business surveys. That gap (61-2) 9003-7982

has now been revised away with 4Q taken up from +0.2%q/q to +0.5%q/q (see also ben.k.jarman@jpmorgan.com

reconciliation vs the survey-based model, first chart below). J.P. Morgan Securities Australia Limited

The signal of cyclical recovery has been consistent across business activity

indicators and population growth, with the only question being the intensity. In our

view the recovery is getting traction, and GDP has been running a bit stronger than

suggested by supply of the labour input. Given the upward revisions, the

characterization of an economy with significant excess capacity is not as

straightforward and this data should be enough for the RBNZ committee to follow

through with a first hike next meeting, per our forecast.

In 1Q, consumer spending was decent (+0.5%q/q, +0.3%-pt contribution), with

services (+0.4%q/q) and goods (durable +0.6%q/q, non-durable +0.3%q/q)

making similar gains. Government consumption was also perky (+1.5%q/q), split

across central and local government, and is likely to continue on the basis of the

Treasury's FY27 fiscal impulse projections presented last month.

With visitor arrivals usually picking up strongly at the start of the year, there is

always some uncertainty on the allocation of private spending to domestic