New Zealand outpaces crawling world economy

New Zealand outpaces crawling world economy

Our first post for 2014 is a good news story for those following trends that will impact on the performance of the New Zealand art market this year.

After five years in the doldrums the New Zealand economy is on the rebound. At the end of 2013 economists were predicting GDP growth of 3% or more and even the IMF expected growth to pick up to 2.9% – ahead of our Western trading partners (including Australia) and not far behind Asian nations like South Korea and Singapore.

And consumer confidence in New Zealand has climbed to a seven-year high in the monthly ANZ-Roy Morgan survey where the index stands at 135.8, up from 129.4 last month and its highest ever since February 2007. A net 50% of the respondents think it is a good time to buy a major household item, up from 39% last month.

The prevailing sense of optimism is reflected in a piece published this week in the Wall Street Journal where Rebecca Howard writes:

“In a world still limping its way out of the global financial crisis, New Zealand's economy is looking remarkably zippy.

“The small Pacific nation of around 4.5 million people expanded by 3.5% in the this quarter from a year earlier, a good deal faster than many other developed economies, including its larger neighbour Australia.

“The Organisation for Economic development, or OECD, expects New Zealand to grow by 3.3% this year, compared with an estimate of 2.9% for the U.S. and a mere 1.0% in the euro area.

“New Zealand's economy is performing so well that some economists expect the central bank to raise interest rates as early as this month – which would put it among the first developed nations to tighten monetary policy since Lehman Brothers Inc collapsed in 2008 and sparked a global recession.”
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Image: Jae Hoon Lee, Farm (2005), digitally manipulated photograph, 800 x 1200 mm