Treasury forecasts gentler slowdown

In its economic indicators report for July, released yesterday, the Treasury said the level of economic activity over the first half of 2004 would be stronger than forecast after gross domestic product grew 2.3 per cent in the first quarter. The rate of quarterly growth was still expected to slow over the year ahead, it said in the report on its website (www.treasury.govt.nz).

"However, there may be sufficient momentum in the domestic economy, coupled with a slightly stronger performance by the external sector, to suggest that the slowdown in the second half of 2004 may be more moderate than initially forecast," it said.

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