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Forex Flash: NZD/USD, anticipating a solid expansion in 4Q NZ GDP - BNZ

FXstreet.com (Barcelona) - This coming Thursday it is due NZ 4Q GDP at 21:45 GMT and BNZ'S Head of Research Stephen Toplis expects things will get “back to normality,” where “All and sundry are anticipating a solid expansion, after Q3’s wobbly 0.2%, with the market median at 0.9%,” the analyst says.

“This would set annual GDP growth at 2.3%. We’re picking a 0.8% quarterly increase, for 2.2% y/y, largely as the construction upswing continues, retail and wholesale trade bounce and, ironically, agriculture posts a strong lift in Q4 (being pre-drought), in turn propping up manufacturing,” Stephen adds.

“For reference, last week’s Monetary Policy Statement had the Reserve Bank anticipating a 0.8% increase in Q4 GDP, in line with our thoughts,” the analyst notes.

“Still, we feel Q4 GDP growth could easily be a few points either side of our expectations, such has been the tug of war in the various indicators. Signals of a stronger increase are still coming via the expenditure GDP components we compute,” Mr Toplis concludes.

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