New Zealand's economy saw its biggest contraction in 29 years in the first quarter as travel restrictions took hold and the country moved toward a lockdown to stop the spread of covid-19, but the bigger hit will come in the June quarter.
The economy fell 1.6 per cent in March, the first quarterly fall since December 2010 and the largest fall since March 1991, Stats NZ said. The economy grew 0.5 per cent in the December quarter. Click here for Liam Dann's analysis.
While economists had forecast a wide range of numbers, from a 2.7 per cent contraction to 0.6 per cent growth, the data is unlikely to come as a surprise.
On the year, the economy fell 0.2 per cent after growing at an annual pace of 1.8 per cent in the December quarter.
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"Industries related to international travel, such as accommodation and transport, began to feel the effects of covid-19 earlier in the quarter, with activity dropping significantly once the borders closed on March 19," national accounts senior manager Paul Pascoe said.
Travel restrictions were applied to Chinese visitors on Feb. 2 and the borders were closed to all foreign nationals on March 19.
Non-essential businesses, however, were only closed for six days, or about 7 per cent of the March quarter, once the lockdown was imposed at 11:59pm on March 25.