The New Zealand economy, as measured by gross domestic product (GDP), grew by 0.3 percent in the December 2011 quarter, Statistics New Zealand said on Thursday. This latest result follows economic growth of 0.7 percent in the September 2011 quarter.
The largest contributors to the increase this quarter, by industry were:
- finance, insurance, and business services (up 1.3 percent) mainly due to business services such as advertising and management services
- agriculture (up 3.5 percent), mainly due to an increase in milk production
- retail, accommodation, and restaurants (up 2.2 percent), following a 2.6 percent rise in the September 2011 quarter. The 2011 Rugby World Cup tournament spanned the September and December 2011 quarters.
Partly offsetting these increases was a fall in manufacturing (down 2.5 percent), mainly due to a decline in primary food manufacturing.
"Growth this quarter was driven by good growing conditions for agriculture, more business services, and spending on the Rugby World Cup," national accounts manager Rachael Milicich said. "However, weaker manufacturing compared with last quarter dragged the overall result down."
The expenditure measure of GDP – which measures the use of goods and services in the economy – rose 0.5 percent in the December 2011 quarter.
Household consumption expenditure – which measures the volume of spending by New Zealand resident households – was up 0.8 percent in the December 2011 quarter.
The increase in the volume of household spending was due to increases in:
- durable goods which includes furniture and major appliances), up 4.0 percent
- services (which includes air travel), up 0.9 percent
- non-durable goods (which includes food), up 0.3 percent.
The volume of goods and services exported were up 2.8 percent in the December 2011 quarter, while import volumes fell 2.9 percent. This combined effect of a large increase in net exports in the December 2011 quarter is consistent with the build-up in inventories in the previous quarter. A build-up of inventories occurs when the supply of goods exceeds demand in a period, and a run-down is when demand exceeds supply.