Research Team at Westpac, notes that the New Zealand economy put in a reasonable performance over the second half of last year, after a slow spell in the first half. Key Quotes “But the details gave no cause for celebration: the economy’s momentum has clearly slowed once we account for population growth, and we suspect that the shock to income from lower dairy prices has yet to have its full impact on activity. GDP rose by 0.9% in the December quarter, matching the rise in the previous quarter and beating market forecasts (including our own) of a 0.7% increase. Construction and services were the main contributors to this increase, while the agricultural sector went backwards (though this was driven by sheep and beef rather than dairying). Our GDP forecasts imply a modest lift in per capita growth over the next couple of years. However, we see construction, more so than tourism, providing the counterbalance to the weakness in the dairy industry. The strong pipeline of work in Auckland and other parts of the North Island should provide a boost to nationwide construction activity, even allowing for the fact that the level of quake rebuild activity in Canterbury has peaked.” For more information, read our latest forex news.