New Zealand Enters Recession, GDP Contracts in Q2 2020

The coronavirus pandemic has pushed New Zealand's economy into the most severe contraction ever recorded during Q2 2020

New Zealand Enters Recession, GDP Contracts in Q2 2020

The coronavirus pandemic has pushed New Zealand’s economy into the most severe contraction ever recorded during Q2 2020. The GDP of New Zealand for the second quarter of the year came in at -12.2% QoQ and -12.4% YoY.

The rate of contraction was slightly better than economists’ forecast, which was for a reading of -12.8%. On a positive note, it also came in better than RBNZ’s estimate for a 14% contraction.

The severe contraction was driven by the lockdown which was imposed through April and into May. With this, New Zealand has officially entered a technical recession, with its GDP contracting for two consecutive quarters.

Despite the disappointing data, economists maintain confidence that New Zealand will bounce back faster than most other countries around the world in the current quarter. Markets widely expect the RBNZ to hold its monetary policy unchanged at its upcoming meeting next week on account of this optimism.

ABOUT THE AUTHOR See More
Arslan Butt
Index & Commodity Analyst
Arslan Butt serves as the Lead Commodities and Indices Analyst, bringing a wealth of expertise to the field. With an MBA in Behavioral Finance and active progress towards a Ph.D., Arslan possesses a deep understanding of market dynamics.His professional journey includes a significant role as a senior analyst at a leading brokerage firm, complementing his extensive experience as a market analyst and day trader. Adept in educating others, Arslan has a commendable track record as an instructor and public speaker.His incisive analyses, particularly within the realms of cryptocurrency and forex markets, are showcased across esteemed financial publications such as ForexCrunch, InsideBitcoins, and EconomyWatch, solidifying his reputation in the financial community.

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