NZ Economy Surprises with Resilience Amid Fuel Price Bites

New Zealand's economy showed more resilience than expected in the three months through June, despite higher fuel costs due to the Middle East conflict. GDP grew by 0.2% from the prior quarter and 2.6% from a year earlier, beating forecasters' estimates.

The construction sector logged its strongest growth in three years, while tourism and exports also contributed to the boost. Investment rose, but private consumption remained unchanged from Q1. GDP per person increased by 0.1%.

The strong data has raised the odds of a rate hike next month. Traders now point to a 69% probability of an increase in October, up from 52% the day before. The Official Cash Rate stands at 2.75%, and investors expect it to reach 3% or higher by year's end.