Analysis: Today’s GDP figures are a glimmer of good news for Labour – but is it enough to convince voters the worst of the economic pain might be over, asks 1News Business Correspondent Katie Bradford.
You could forgive Grant Robertson for having a slight smile on his face following the news New Zealand is no longer in a recession following the release of today’s GDP figures.
That grin only widened when it was revealed there never even was a recession.
It was a technical recession in the first place, but revision by Stats NZ means analysts now think the previous March quarter was “flat”.
This is why the Finance Minister is calling the slight increase in GDP for the June quarter a “victory for the economy”.
It’s given him heart and he’s used it to accuse National leader Christopher Luxon of talking down the economy ahead of next month’s election.
Whether it’s on a factory floor or on a goat farm, Luxon has a routine of starting his daily press conferences by insisting this election is all about the economy and that Labour has done an abysmal, dismal, downright dangerous job of handling it.
And that, Grant Robertson says, helps no one.
In his language today he was very careful to acknowledge how tough it’s been for households and businesses – and to thank them for their hard work.
Quietly, Labour’s confident the worst is over. And now they have three weeks to convince the voting public of that.
Meanwhile, National are trying to ignore the fact there never was a recession. They are determined to turn Labour’s small feeling of victory into an insult to everyday Kiwis.
National’s Nicola Willis claims “most New Zealanders” still feel like they are in a recession. And that is where it will continue to bite Labour. It doesn’t matter what the numbers say, it’s how people feel when they try and buy a few basics (ouch) or fill up at the petrol pump (double ouch).
Retail is one of those areas where it’s clear there is hurt, and that’s because people are doing exactly what the Reserve Bank wanted and pulling back on spending.
But with the economy growing a bit faster than expected, the central bank will likely be a bit jittery and may look at another small rate hike later in the year. The Federal Reserve has held off on any further rates hikes, but with a caveat there may be more to come.
While the latest GDP figures are a glimmer of good news for Labour, it could be too little, too late.
With so much riding on the economy this election, it’s a toss of the coin as to what hand the next finance minister will be dealt.
Many pundits are still predicting an actual recession is on the cards. But if Labour are forced to hand the reins to National after October 14 and that recession doesn’t eventuate, National will continue to lay claim to the economic manager’s crown.
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