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Speaker 1: Now the state of the economy will be revealed on

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Speaker 1: Thursday when the GDP for Q two is out. It's

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Speaker 1: widely expected that GDP went backwards again. Brad Olsen is

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Speaker 1: info Metrics principle economist and with us now ay Brad,

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Speaker 1: good evening, what do you reckon? What are you picking?

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Speaker 2: The Infmetrics pick is a point two percent quarterly fall,

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Speaker 2: so sort of in the middle of the range by

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Speaker 2: the Luxford of most of the major forecast. Is everyone

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Speaker 2: in New Zealand looking like the packing sort of anywhere

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Speaker 2: between point one and point five percent down. Long story short,

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Speaker 2: that doesn't sound huge, but it's that continuation of weaker

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Speaker 2: and weaker economic conditions and we're likely to probably see

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Speaker 2: that persist for the rest of this year. Of course,

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Speaker 2: we're wanting to get a bit of a gauge on

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Speaker 2: how different parts of the economy are going. We know that,

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Speaker 2: for example, healthcare has still been quite a large growing area.

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Speaker 2: But we'll be looking at or trying to get a

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Speaker 2: bit more detail on how households are feeling, if there's

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Speaker 2: you know, how bad and a sense investment decisions are getting.

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Speaker 2: So a lot of details that will be picking over

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Speaker 2: on thirsdy. But again, you know that activity here there

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Speaker 2: was what three months ago now, so it is very

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Speaker 2: much in the rearview mirror will be also, I mean

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Speaker 2: comparing some of those figures with some of the more

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Speaker 2: recent economic indicators to try and give us a gauge

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Speaker 2: for how challenging the economy still is and maybe when

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Speaker 2: we're expecting it to turn around the other way.

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Speaker 1: So what we're seeing at the moment, obviously, thank godness,

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Speaker 1: is all the interest rates coming back, the home loan

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Speaker 1: lending rates. How long before we actually start to see

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Speaker 1: this playing a role in GDP?

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Speaker 2: Look, I think it's probably another almost six to nine

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Speaker 2: months away, just because of how long it's going to

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Speaker 2: take for all of those households to refix onto lower

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Speaker 2: mortgage rates. I mean, but you're right, it's probably a

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Speaker 2: little bit quicker than normal economic downturns in a sense

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Speaker 2: because households have been primed for lower interest rates. And

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Speaker 2: let's be clear, I feel like the downslide at the

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Speaker 2: moment in mortgage rates is probably faster than any of

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Speaker 2: us predicted. You know, I saw another of the major

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Speaker 2: banks cut their rates today. They're now I think the

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Speaker 2: one year is sitting it's something like six point two nine,

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Speaker 2: so things really are starting to move now. Of course,

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Speaker 2: not every household refixes their mortgage three seconds later, so

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Speaker 2: it will take a bit of time. And what we're

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Speaker 2: sort of thinking at the moment is that the next

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Speaker 2: six to nine months is probably going to be dominated

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Speaker 2: by fewer job opportunities coming through, further increases to unemployment.

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Speaker 2: But get through twenty twenty five. As people are refixing

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Speaker 2: their mortgages, they've got a bit more spare cash, they're

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Speaker 2: spending a bit more in the economy, there's more jobs

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Speaker 2: that come forward, and that's when we think that economic

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Speaker 2: mojo comes back a bit.

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Speaker 1: It's good to talk to you, Brad always as thank

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Speaker 1: you very much, mate, look after yourself. It's Brad alsoon

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Speaker 1: Infamtric Principal Economist.

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