New Zealand is officially in a recession. The Stats NZ figures released last week confirmed two quarters of negative growth – a fall of 0.1 percent in the three months ended March, following a fall of 0.7 percent in the December quarter.
This contraction is at odds with the Reserve Bank’s forecast of 0.3 percent growth - leading to the question of whether their interest rate increase, which started in October 2021 and has led to the present 14-year high, has been too aggressive.
In 2017 Labour inherited a “rock star” economy. It deteriorated sharply in 2020 as Prime Minister Jacinda Ardern’s “world leading” harsh lockdowns and strict border closures took effect. The post-lockdown borrowing and spending that flooded the economy with easy money and created runaway inflation was unprecedented.
