After a slow economic year, many New Zealanders are eyeing 2025 with uncertainty but also a degree cautious optimism. Interest rates are dropping and unemployment rates remain below expectations.
However, Treasury’s Half Year Economic and Fiscal Update revealed a sluggish economy and weaker tax take than was expected. Government spending was forecast to also increase for the year ending June 2025.
This means there will be a further delay till a return to budget surplus, and an increase in borrowing. Treasury made particular mention of New Zealand’s sluggish productivity growth holding back recovery and income increases.
