21 Mar 2011

Economists pare back growth forecasts

1:25 pm on 21 March 2011

Weak economic activity and the second Canterbury earthquake have prompted economists to again pare back their growth forecasts.

Economic forecasters polled as part of the New Zealand Institute of Economic Research's latest quarterly consensus report, have cut their expectations for economic growth in the coming year.

They now expect the economy to have expanded by 0.8% in the year to March, 1.3% less than forecast in December.

Growth expectations for 2012 have been also been cut to 2%.

The outlook for growth in 2013 has brightened slightly, however, with expectations rising from 2.6% to 3.9% growth.

Forecasters expect consumer price inflation to peak at 4.6% this month, and the labour market to remain soft in the short term.