New Zealand’s economy continues to recover, but the recovery remains fragile and uneven. The latest NZIER QSBO shows a marked improvement in business confidence, hiring and investment intentions, although actual activity and household demand remain soft. Inflation remains elevated, and renewed increases in global oil prices pose an upside risk. This NZIER Insight examines the challenging environment facing the next Government, with fiscal choices constrained by the inflation outlook and the Government’s fiscal position. Greater policy certainty and well-targeted investment remain important for lifting productivity and long-term growth.
NZIER Insights are short notes designed to stimulate discussion on topical issues or to illustrate frameworks available for analysing economic problems. They are produced by NZIER as part of its self-funded Public Good Programme. The purpose of NZIER’s Public Good Programme is to inform debate and educate on important economic and policy issues facing Aotearoa New Zealand. More information on NZIER’s Public Good Programme can be found at https://www.nzier.org.nz/public-good.
