The new GDP figures show the New Zealand economy shrank 0.6 percent in the final three months of last year.
It's a bigger drop than any of the major banks were predicting and it increases the chances we could be heading for a recession - which is defined as two consecutive quarters of negative growth.
Manufacturing saw the biggest drop, but the construction sector showed surprising growth.
ASB Economist Nat Keall spoke to Corin Dann.
