Economy heads into reverse

For the first time in more than two years, the economy is going backward, by 0.3 per cent in the past three months, according to a National Bank report – but the bank still expects a “soft landing”.

Parts of the economy appear to be hit by rising mortgage interest rates, with falling house sales across all regions for the past six months. That is typically followed by lower house prices, waning consumer confidence and falling shop sales, though that has not happened yet.

“Things are very unsettled, and looking out is tricky, with higher mortgage rates to slow the housing market, but commodity prices are picking up,” National Bank economist Steve Edwards said. “It is a topsy-turvy time in the business cycle.”

Read more

Leave a Reply

Fill in your details below or click an icon to log in: Logo

You are commenting using your account. Log Out /  Change )

Google photo

You are commenting using your Google account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s