New Zealand Economy Posts 0.7% Quarterly Growth After Two Contractions

New Zealand's economy grew by 0.7% quarter-on-quarter in the three months to December 2024, recovering from a 1.1% contraction in the previous period and surpassing the market's expected 0.4% growth.

This expansion comes after two consecutive quarters of declines, the largest since late 2021 during the height of the pandemic and lockdowns.

The primary drivers of growth were agriculture, forestry, and fishing (+1.4% vs.

-0.2% in Q3), rental, hiring, and real estate services (+1.1% vs.

+1.1% in Q2), and manufacturing (+0.3% vs.

-2.1% in Q3).

However, business services (-0.2% vs.

-1.6% in Q3) and construction (-3.1% vs.

-2.5% in Q3) continued to weigh on the economy.

On an annual basis, GDP contracted by 1.1%, following a 1.6% decline in Q2.