Prediction of 2 p.c. GDP growth

Press, 17 February 1984, Page 9

Prediction of 2 p.c. GDP growth

PA Wanganui A 2 per cent growth in New Zealand’s gross domestic product was forecast by the retiring governor of the Reserve Bank, Mr D. L. Wilks, yesterday. Addressing the annual conference of the Trustee Banks Association, Mr Wilks said the general forecast for 1984-85 was of an economy which would pick up, but only slightly.

“There does seem to have been some slight domestic pick-up in the latter part of last year,” he said.

“In recent months there have been positive movements in retail turnover, car sales, residential construction, in some indicators of plant and machinery investment and in business

confidence.

“We see this pick-up continuing into 1984-85, though probably not strongly.” A world economic recovery, led by the United States, had arrived but did not appear to be spreading very rapidly to other major industrial economies, Mr Wilks said. Doubts remained about the durability of the recovery but it was, nevertheless, likely to be more conducive to economic growth in New Zealand in 1984-85 than for some time.

The country’s inflation at the end of the current financial year would be much the same as the 3.6 per cent for the year to December but was forecast at 6 per cent for 1984-85, Mr Wilks said.