New Zealand’s market grew faster than the projections made by financial experts last quarter on Rugby World Cup expenditure, a boost the central bank can look past as it expects more fixed recovery signs before lifting record-low rate of interests.
Gross domestic product rose 0.8 percent in the months ended Sept. 30 from the earlier quarter, when it increased 0.1 percent, Statistics New Zealand said in a document released today in Wellington. Growth was faster than the 0.6 percent median. Investors bet Reserve Bank Governor Alan Bollard will see the tourism windfall as a temporary lift and hold the official funds rate at two.5 percent until late next year, as the central bank forecasts a stronger recovery in 2012 on rebuilding of earthquake-devastated Christchurch. Deutsche Bank AG economist Darren Gibbs pushed back his prediction for Bollard’s next increase to September from June today.
“We can expect a softer run of GDP numbers over the next few quarters as the Rugby World Cup impact washes out of the information” Mark Smith said, an economist at ANZ National Bank Ltd. in Wellington. “We continue to look for a December 2012 start to the tightening cycle, barring a global meltdown.”
New Zealand’s dollar fell after the information. It bought 76.83 U.S. cents as of 1:41 p.m. in Wellington from 77.08 cents immediately before the document. The funds known as the kiwi is down 13 percent since Aug. one when it reached 88.43 cents, the highest level since exchange-rate controls were removed in 1985.
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