New Zealand Gross Domestic Product had been estimated to rise 2.4% year-to-year in the third quarter from 2.1% in the second. On a quarterly basis, GDP was forecasted to increase by 0.6%, up from 0.5% in the second quarter.
NZ Q3 GDP outcome
- Gross Domestic Product (YoY) (Q3): 2.3% (est 2.3%; prev 2.1%).
- Gross Domestic Product (QoQ) (Q3): 0.7% (est 0.5%; prev 0.5%).
FX implications
The data follows robust Retail sales and Manufacturing and a healthy pick up in the housing sector along with rising consumer confidence. “Much more important is the fact that momentum in the economy has clearly lifted in Q4,” analysts at Westpac argued.
The data comes in line with the market’s pricing for a 5% chance of RBNZ easing in February, with a terminal rate of 0.91% (RBNZ OCR currently at 1.0%).
“However, like us, they’ll be keeping a nervous eye on global dairy prices after yesterday’s unexpectedly sharp fall. New Zealand’s commodity prices have thus far been remarkably resilient to slowing global growth due to supply factors,” the analysts at Westpac explained.
Meanwhile, NZD/USD bulls have run out of steam at the top of the rising channel:
- Support 0.6510.
- Resistance 0.6610.
The kiwi went full circle overnight as sentiment remained subdued on little data overnight. On the data, the bird is now bid on the data.
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