21 Sep 2010

Less optimism about recovery - survey

2:38 pm on 21 September 2010

A survey by the New Zealand Institute of Economic Research shows economic forecasters are becoming less optimistic about the strength of the recovery.

The institute's quarterly consensus forecasts estimate the economy will expand by 2.8% in 2011, 0.5% less than what was forecast in June.

Growth expectations for 2012 have been also been trimmed, falling from 3.3% to 3.1%.

Principal economist Shamubeel Eaqub says there are very divergent views among economists on the strength of the recovery, in part because of uncertainty about the effects of the Canterbury earthquake earlier this month.

Mr Eaqub says the economy is not headed for a double-dip recession, but the recovery momentum is fading slightly.

He says the recovery so far, has been shallow.