We’re in recession!

Stats NZ reports:

Gross domestic product (GDP) fell 0.1 percent in the March 2023 quarter, following a 0.7 percent fall in the December 2022 quarter, according to quarterly figures released by Stats NZ today.

We’re in recession, with a 0.8% drop over two quarters. As interest rate rises flow through, we may have the recession extend to a third quarter.

Recessions are rare in NZ. Here are the recessions we have had since 1991:

• Jul 97 – Mar 98 – shrunk 0.9% (Asian Financial Crisis)
• Jan 08 – Mar 09 – shrunk 2.7% (Cullenomics and GFC)
• Jul 10 – Dec 10 – shrunk 0.7% (Canterbury earthquake)
• Jan 20 – Jun 20 – shrunk 11.2% (Covid-19)

This recession is mainly because inflation got out of control, and interest rates have had to be hiked to bring inflation down.