NZ Economy Shows Slight Growth Amid Ongoing Struggles

New Zealand's economy showed a slight improvement in the three months to June, with GDP increasing by 0.2%. However, this growth was largely driven by a 2.7% boost in construction, while other industries struggled due to the ongoing Middle East conflict and associated fuel crisis.

Labour criticized the government's response to the economic downturn, stating that Kiwis are worse off now than they were in 2023, with real GDP per person down by over $1,000 since then.

Economists had previously predicted a recovery, with many citing Trump's handling of the Iran issue as a reason for optimism. However, recent events have cast doubt on these predictions, including a surge in oil prices and bond markets rebelling against the US fiscal position.

New Zealand government bond yields reached their highest level since November 2023, while Brent crude oil shot up to $109 a barrel. The US Treasury Secretary's efforts to suppress rates were met with failure as the influential 30-year Treasury bond hit its highest point since 2007.