GDP growth eases in December

New Zealand’s Gross Domestic Product (GDP) was up 0.4 in the December 2016 quarter, following a revised 0.8 per cent increase in the September 2016 quarter. Growth for the year ending December 2016 was 3.1 per cent, according to the latest Statistics New Zealand report. GDP per capita fell 0.2 percent this quarter and increased 0.9 per cent overall for the year. “Growth in service industries was partly offset by weaker activity in primary industries also flowing through into manufacturing,” national accounts senior manager Gary Dunnet said. “At an industry level, growth was a mixed bag, with only half of our 16 industries rising.” The largest industry increases include business services, up 1.7 percent, arts, recreation, and other services, up 3.8 percent and construction, up 1.8 percent. The main decreases by industry were manufacturing, down 1.6 percent, agriculture, down 0.6 percent, and mining, down 2.3 percent. Imports for the December 2016 quarter grew 1.9 per cent due to a 2.4 per cent increase in goods and 1.5 per cent rise in services. Imports of capital goods were up 4.1 per cent, which reflects a growth in investment in plants, machinery and equipment. These and a 8.3 per cent increase in passenger motor vehicle imports were the primary contributors to the growth in imports in the December quarter. Household consumption expenditure increased 0.4 per cent in the December quarter, following two quarters of strong growth. This totalled a yearly 4.3 per cent increase in expenditure, the highest annual movement since March 2006. Houeshold expenditure on durable goods rose 1.3 per cent, due to increased spending on motor vehicles, furniture and furnishings, and audio-visual equipment. Expenditure on services rose 0.9 per cent. Spending on non-durables declined 0.7 per cent in the Decemebr 2016 quarter, led by a fall in petrol and grocery spending. The size of the economy in current prices was $261 billion.