Banks raise projections for growth

Thursday 24 June 2004

Growth in the March quarter is shaping up as a "stunner", with market expectations of about 1.6 per cent expansion - just over 4 per cent for the year, according to National Bank.

By The Landlord

That may mean either one or two more interest rate rises by the Reserve Bank to dampen down the economy and rein in inflation, National Bank said.

Official gdp figures for the March quarter are due out on Friday.

A 25 basis point rate rise to 6 per cent on the official cash rate looks like a "done deal", National Bank said, but pushing interest rates beyond that carried economic risks.

The direct impact of another 25 points up in September would be small, but it could damage confidence, so the indirect effect could be bigger.


Westpac Bank economists said a March quarter result above 1.5 per cent was likely to keep the Reserve Bank "hawkish" at its next announcement on July 29. Westpac tipped 1.5 per cent growth for the three months, though forecasts range up to 2.3 per cent.

Read More - Opens in a new window
Commenting is closed

Property News

Share your views on property investing

It's that time of the year where we run the NZ Property Investor's survey of investor. Take part and be in to win.

House Prices

Values pick up the pace

There’s a more upbeat feel to the property market and it’s obvious in this month’s QV data which has values firmly on the rise.

Commercial

Commercial disrupter proves popular

New commercial property disrupter, Jasper, has hit the ground running with their first investment offering achieving full subscription in just 36 hours.

Mortgages

LVRs kept on hold

The Reserve Bank has kept its LVR speed limits on hold amid fears low interest rates "could lead to a resurgence in higher-risk lending".

Site by PHP Developer