1 00:00:00,040 --> 00:00:02,120 Speaker 1: So funny old GDP day today given the war and 2 00:00:02,160 --> 00:00:03,680 Speaker 1: what might still be to come. But for now the 3 00:00:03,720 --> 00:00:06,920 Speaker 1: gdbread four Q four October November December is coming. Everyone's 4 00:00:06,920 --> 00:00:08,880 Speaker 1: in the black. It's just by how much. Nick Tuffley 5 00:00:08,960 --> 00:00:11,440 Speaker 1: is the ASB Chief economist, is back with us. Nick, morning, 6 00:00:12,119 --> 00:00:14,280 Speaker 1: Good morning, you're at zero point four. What do you 7 00:00:14,280 --> 00:00:15,000 Speaker 1: see driving that? 8 00:00:16,280 --> 00:00:19,400 Speaker 2: Well, it's actually a lot of what's driving that is 9 00:00:19,440 --> 00:00:21,880 Speaker 2: what's happening on the export side of the equation. So 10 00:00:21,920 --> 00:00:24,480 Speaker 2: we're just seeing that the agriculture sector is still having 11 00:00:24,480 --> 00:00:27,760 Speaker 2: a good finish to last year, and the tourism industry 12 00:00:27,840 --> 00:00:30,760 Speaker 2: had a really good finish as well, so it's still 13 00:00:30,880 --> 00:00:33,919 Speaker 2: a bit uneven. Whilst the stuff that we make here 14 00:00:33,960 --> 00:00:36,920 Speaker 2: in New Zealand, particularly things like construction, was actually weak 15 00:00:37,080 --> 00:00:41,600 Speaker 2: as well. So we've got that kind of uneven recovery 16 00:00:41,800 --> 00:00:43,600 Speaker 2: or at least over that fourth quarter. 17 00:00:43,560 --> 00:00:45,720 Speaker 1: Right, So if you add the Q three number two 18 00:00:45,800 --> 00:00:49,480 Speaker 1: at wore aside, would we be under normal circumstances sitting 19 00:00:49,479 --> 00:00:51,599 Speaker 1: here going the recovery is on, it's real and there 20 00:00:51,600 --> 00:00:52,720 Speaker 1: are your numbers to back it up. 21 00:00:53,520 --> 00:00:55,120 Speaker 2: Yeah, Well you would have had one and a half 22 00:00:55,120 --> 00:00:59,240 Speaker 2: percent growth over over two quarters or six months. Although 23 00:00:59,280 --> 00:01:02,360 Speaker 2: bearing a mind with up one down, one up, one down, 24 00:01:02,400 --> 00:01:04,880 Speaker 2: one one and a half, well, it's a three percent 25 00:01:04,880 --> 00:01:08,479 Speaker 2: annualized trend. Look that's looking pretty good. And look that's 26 00:01:08,520 --> 00:01:12,679 Speaker 2: what we have been expecting up until the war, that 27 00:01:12,720 --> 00:01:15,520 Speaker 2: we will get up to a trend sustainable pace of 28 00:01:15,600 --> 00:01:20,000 Speaker 2: about three percent, which wouldn't be bad to hit that. 29 00:01:20,160 --> 00:01:22,319 Speaker 2: But obviously things are a bit up in the air now. 30 00:01:22,520 --> 00:01:24,760 Speaker 1: Yes they are dairy though is that up in the 31 00:01:24,800 --> 00:01:26,959 Speaker 1: air as much as people might think given that, I mean, yes, 32 00:01:27,000 --> 00:01:28,479 Speaker 1: the Middle East of the Middle East and three billion 33 00:01:28,520 --> 00:01:30,920 Speaker 1: dollars worth of trade, not all dairy obviously, but nevertheless 34 00:01:31,120 --> 00:01:33,400 Speaker 1: the dairy does a lot of heavy lifting around the world. 35 00:01:33,640 --> 00:01:36,080 Speaker 1: Is that materially affected by the war? 36 00:01:37,200 --> 00:01:38,720 Speaker 2: Well, what we're seeing at the moment, what we can 37 00:01:38,800 --> 00:01:42,040 Speaker 2: remember with dairys is like we produce what we produce. 38 00:01:42,080 --> 00:01:44,280 Speaker 2: It's basically the weather gods are driving and driving a 39 00:01:44,319 --> 00:01:46,640 Speaker 2: lot of at So it is coming down to price 40 00:01:46,760 --> 00:01:49,400 Speaker 2: and what we've seen so far anyway, it's very early days, 41 00:01:49,400 --> 00:01:52,240 Speaker 2: but price over the space for a couple of auctions 42 00:01:52,240 --> 00:01:53,920 Speaker 2: its been a bit bit up and down, but prices 43 00:01:53,920 --> 00:01:56,240 Speaker 2: are holding up. So that's the thing. We've also got 44 00:01:56,240 --> 00:01:58,200 Speaker 2: to got to remember as well. 45 00:01:58,280 --> 00:02:00,840 Speaker 1: I also see tourism as but am I naive here? 46 00:02:00,920 --> 00:02:02,480 Speaker 1: I mean, tourism has got to be good. I'm looking 47 00:02:02,480 --> 00:02:04,360 Speaker 1: at some of those American airlines and they're talking about 48 00:02:04,400 --> 00:02:07,279 Speaker 1: I mean, they're upgrading yesterday. Because the world is shifting 49 00:02:07,280 --> 00:02:09,359 Speaker 1: away from the Middle East into places like the America's 50 00:02:09,400 --> 00:02:12,000 Speaker 1: up through Asia. Surely we've got a benefit from that. 51 00:02:13,000 --> 00:02:15,680 Speaker 2: Look, it's quite a mix of things that you're right. 52 00:02:15,720 --> 00:02:17,799 Speaker 2: You've got people going, Okay, well I would have gone 53 00:02:17,840 --> 00:02:20,480 Speaker 2: to holiday to this place, Now I'll go somewhere else. Hey, 54 00:02:20,480 --> 00:02:23,680 Speaker 2: what about New Zealand. So there is that potential, particularly 55 00:02:23,680 --> 00:02:26,679 Speaker 2: out of those North American routes. We've done well. It's 56 00:02:26,680 --> 00:02:30,200 Speaker 2: been one of our good post COVID recovery markets, and 57 00:02:30,240 --> 00:02:33,480 Speaker 2: people have still been traveling out of North America. The 58 00:02:33,520 --> 00:02:36,440 Speaker 2: thing we've got to watch is one, it's getting a 59 00:02:36,440 --> 00:02:38,760 Speaker 2: little more expensive to fly planes and that's going to 60 00:02:38,760 --> 00:02:41,560 Speaker 2: sharpen the airfares and sort of forward bookings at some point. 61 00:02:41,760 --> 00:02:44,560 Speaker 2: And the other thing is the disruption of those links 62 00:02:44,800 --> 00:02:48,080 Speaker 2: through the Middle East. So there's that question of are 63 00:02:48,120 --> 00:02:51,959 Speaker 2: the people from Europe who won't come now balanced against 64 00:02:51,960 --> 00:02:55,680 Speaker 2: people who could come from say Asia or North America. 65 00:02:55,440 --> 00:02:57,200 Speaker 1: The right here, right now. How nervous are you? 66 00:02:58,919 --> 00:03:00,960 Speaker 2: So we're still I think we're still going to be 67 00:03:00,960 --> 00:03:03,120 Speaker 2: growing this year. The thing I think we need to 68 00:03:03,120 --> 00:03:05,200 Speaker 2: look out for is lock. If it's just if it's 69 00:03:05,360 --> 00:03:08,919 Speaker 2: just a period of painful high petrol prices, We've been there, 70 00:03:08,960 --> 00:03:11,960 Speaker 2: done that before. It does slow consumer spending a bit. 71 00:03:12,560 --> 00:03:14,480 Speaker 2: The thing we need to be mindful of is if 72 00:03:14,520 --> 00:03:18,600 Speaker 2: we do get to the point of experiencing fuel disruptions 73 00:03:18,600 --> 00:03:21,519 Speaker 2: here in New Zealand, that's where you know things change 74 00:03:21,520 --> 00:03:22,040 Speaker 2: a little bit. 75 00:03:22,200 --> 00:03:23,679 Speaker 1: All right, we'll get you back on even when that 76 00:03:23,760 --> 00:03:26,080 Speaker 1: ever happens. On fingers Cross, it doesn't. Nick Tuffley, ASP 77 00:03:26,240 --> 00:03:28,600 Speaker 1: chief Economists, so he's got zero point four for the day. 78 00:03:28,639 --> 00:03:30,160 Speaker 1: The numbers out I think at about a quarter to 79 00:03:30,200 --> 00:03:33,519 Speaker 1: eleven this morning. For more from The Mike Asking Breakfast, 80 00:03:33,680 --> 00:03:37,000 Speaker 1: listen live to news talks that'd be from six am weekdays, 81 00:03:37,240 --> 00:03:39,280 Speaker 1: or follow the podcast on iHeartRadio.