Amid growing concerns about the impact of the coronavirus, and the risks posed by a spreading drought, economists have begun to utter the "R word".
BNZ head of research Stephen Toplis said on Monday that the chances that New Zealand's economy slips - at least briefly - into recession were "plausible, not probable, yet".
A recession is defined as at least two consecutive quarters of negative economic growth in a row.
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Toplis said while both the drought and coronavirus posed risks in isolation, the combination of the two created a bigger problem, with farmers being squeezed at a time when export markets were disrupted.
"The two are running headlong into each other and it's the combination of the two factors that I guess we're worried about, that they exacerbate each other."
BNZ is currently forecasting growth of around 0.8 per cent over the first six years, which Toplis said meant New Zealand was vulnerable to a technical recession if the impacts were at the upper end of its estimates.
As well as obvious hits to meat and seafood exports, tourism and international education, it was likely that the economy would face hits "in all sorts of weird and wonderful ways" in the coming months due to disruption to international supply chains, Toplis said.
"We have no way of forecasting the second-round effects and we've got no way of forecasting how long this stuff lasts, so if you look at our forecasts, it can only really … be downside risks."
Infometrics chief forecaster Gareth Kiernan said it was "quite a distinct possibility" that coronavirus would mean that New Zealand's economic growth was negative in the first three months of the year, but it would take a prolonged impact from the virus to mean the impact would worsen again in the second quarter.
"It [coronavirus disruption] would sort of have to extend in a full-blown state through to the end of May, Kiernan said.
"That, to me, at this stage, seems a little bit unlikely."
ANZ chief economist Sharon Zollner said the odds of a brief recession had "definitely risen, quite sharply" in recent weeks.
"We certainly see the disruption as being very likely to persist into [the second quarter," Zollner said.
In the opening months of the year the disruption would be felt mainly by exporters, whereas in the following months the impact could be on importers, if there was disruption to products such as building materials, steel, fertiliser and "a whole lot of stuff that we didn't even know we imported from China", Zollner said.
"We're all hoping that the disruption doesn't last long, but for now at least, China's putting more restrictions on rather than taking them off. As long as that's the case, then we can't really put an end point on it."
ANZ is forecasting 0.3 per cent growth in the first three months of the year, followed by 0.5 per cent in the second quarter.
The risks to ANZ's forecasts were "absolutely" to the downside, Zollner said.
"This is rapidly turning into a best case scenario."
While all recessions have the same core definition of two consecutive quarters of negative growth, economists tend to describe short recessions which do not also come with rising unemployment and falling asset prices as "technical" recessions.
BNZ stressed that this was what it was outlining, with Toplis saying even if growth was negative in the first half of the year, he did not expect a significant rise in unemployment or a sharp fall in inflation.
The timing though, were it to unfold, could have political ramifications.
Statistics NZ has said it will announce how much New Zealand grew in the second quarter of 2020 on September 17.
That means that in the event that New Zealand does see two quarters of negative growth in the first half of the year, a recession could be effectively be announced two days before the general election.
Treasury yesterday released new estimates for annual GDP, factoring in coronavirus impact. It now estimates growth of 2 to 2.5 per cent in 2020 - down from the previous estimate of 2.2 to 2.8 per cent.