Higher retail consumption lifts GDP

Gross domestic product increased 0.7 percent in the September 2019 quarter, boosted by retail spending, Stats NZ said today.

This follows a revised rise of 0.1 percent in the June 2019 quarter.

“Retail industry growth of 2.4 percent in the quarter was boosted by robust spending on electronics such as appliances, mobile phones, and computers after a quieter period in the June quarter,” national accounts senior manager Gary Dunnet said.

Gadgets give retail sales a charge has more on recent electronics sales.

“Consumer spending on these goods was captured in household spending, which rose 0.8 percent. Spending on durables was up 2.6 percent, the strongest quarterly growth since the March 2017 quarter,” Mr Dunnet said.

Service industries, which make up about two-thirds of the economy, grew 0.4 percent this quarter, following 0.8 percent growth last quarter.

“Services growth was widespread, with positive results in 7 of the 11 service industries, including information media and telecommunications, up 2.7 percent, and business services, up 0.7 percent,” Mr Dunnet said.

Expenditure on GDP rose 0.6 percent in the quarter, buoyed by the higher household spending.

Revisions to quarterly and annual growth rates follow the incorporation of the latest annual national accounts data released last month.

“This update to quarterly gross domestic product occurs every September quarter,” Mr Dunnet said.

“This process allows us to incorporate more comprehensive and accurate data as it becomes available, ensuring that our quarterly GDP measures continue to reflect the changing nature of New Zealand’s economy.”

The benchmarking of quarterly data to updated annual information is best practice around the world.

For the year to June 2019, GDP growth was initially reported as 2.4 percent. This has been revised up to 2.8 percent. Over the year to September 2019, GDP grew 2.7 percent.

“The revised results show that average annual growth rates held up for slightly longer than previously published. However, recent trends remain unchanged, with average annual growth rates slowing over the past few quarters,” Mr Dunnet said.

“While the annual picture for growth is slightly improved from that published three months ago, the impact has not been evenly felt in individual quarters.”

Growth in both the September and December 2018 quarters was revised up, but this was tempered by lower growth in the March and June 2019 quarters than previously published.

Video

View a video summary of the Gross domestic product: September 2019 quarter on the Stats NZ YouTube channel after 11am today.

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