The New Zealand Treasury released its economic scenarios for lockdown. The key points are:The pandemic is a ‘once in a century’ public health shock having a profound impact on economic and financial systems
around the world and in New Zealand.There is a high level of uncertainty on the path the NZ economy will take.All scenarios begin with a deep contraction in activity in the June quarterWhen the public health risks diminish, and containment measure here and internationally de-escalate, the global and
domestic economy will begin to recover, supported by large fiscal packages and the significant easing in monetary policy
-timing and pace of recover is unclear.NZ GDP to fall at least 13% in year to March 2021 and could fall as much as 33%Peaks in the unemployment rate will be around 13% if the lockdown remains at 4 weeksIf lockdown extended the unemployment rate could reach between 17.5 to 26%If lockdown stays at 4 weeks, and the Government provides extra support for businesses, the unemployment rate can stay
below 10% and return to 5% by 2021Forecast show the NZ economy can bounce back to be NZD$70 billion larger by 2024 than in 2019.World outlook is also highly uncertain
TheNZD little changed in immediate response
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Current indicative levels are:NZD-USD 0.6070 / 0.6095NZD-AUD 0.9535 / 0.9560NZD-EUR 0.5565 / 0.5590NZD-GBP 0.4955 / 0.4980NZD-JPY 65.50 / 65.75
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Below is the link to the complete Treasury report: