Downgrades to expected GDP growth in Aust, NZ

Research note - downgrades to expected GDP growth in Australia and New Zealand

We have been forecasting recession in Australia since last October, but the latest dire news on the global economy means that we are even more confident in this view than before. Our global team again has marked down the forecast for 2009 global GDP "growth" to -1.6%.

Deteriorating conditions offshore and the worsening credit crunch point to a deeper Australian recession than previously forecast. We now look for Australia's economy to contract 0.5% in 2009, a marked change from our previous forecast of a weak 0.2% expansion.

The New Zealand economy also will likely be weaker than previously forecast. A contraction in GDP in Australia, New Zealand's largest trading partner, will be a major headwind. In our revised forecast, the small, open, exporting Kiwi economy will shrink 0.7% in 2009 as export volumes collapse and private consumption stalls.

See... Growth_downgrades.pf.pdf

© Scoop Media