NZ GDP falls 0.2% in September quarter

Thursday 23rd December 2010

New Zealand's gross domestic product fell 0.2% in the September quarter, with the manufacturing, construction and mining industries all in reverse.

Manufacturing fell 1.7% in the three months to September, construction was down 2.5%, and mining activity fell 6.9%, Statistics New Zealand (SNZ) said today.

For the year to September, GDP rose 1.4% compared to the year to September 2009, with primary industry activity up 1.1% including a 13.5% rise in forestry and logging activity.

The GDP decline in the latest quarter suggests the economy's stuttering efforts at recovery ran out of steam.

After falling for five consecutive quarters through 2008 and the first quarter of 2009, GDP grew for five quarters but in two of those periods added only 0.1% growth, including the June 2010 quarter, and in another just 0.2% growth was achieved.

SNZ said the main contributors to the 1.7% fall in manufacturing during the quarter were petroleum, chemical, plastic, and rubber products manufacturing, and machinery and equipment manufacturing.

The 2.5% fall in construction for the quarter was the first since the September 2009 quarter and resulted from declines in both residential and non-residential building.

Sectors of the economy to record growth included wholesale trade, which rose 2.4% in the quarter for its fourth consecutive quarter of growth, and a 3.4% rise in transport and storage, the largest rise in the sector since December 2003.

Activity in the primary industries sector overall fell 2.8% in the September quarter, the largest fall in the sector since March 2008, SNZ said.

The 6.9% fall in mining activity followed a 6.1% rise in the June quarter, with a decline in both extraction and exploration activity contributing to the fall in the latest quarter.

Agriculture activity fell 1% in the September quarter, due to a fall in livestock production, partly offset by increased milk production. It was the second consecutive fall in agriculture activity, following a 1.9% fall in the June quarter, SNZ said.

For all goods-producing industries, economic activity fell 1.5% in the latest period, with a 1.2% rise in electricity, gas and water activity, due to increased electricity generation and supply, unable to offset the falls in manufacturing and construction. For the year, activity in the goods-producing industries rose 0.1%, the first annual rise since June 2008.

Service industry activity was up 0.3% in the September quarter, and was up 1.3% for the year.

The expenditure measure of GDP declined 0.4% in the September quarter, SNZ said.

The volume of goods and services purchased by New Zealand households was up 0.5%, with volumes of durable goods expenditure by households up 0.9%, and the volume of expenditure on services up 0.5%.

NZPA

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