New Zealand GDP Contracts 0.7% Annually in Q1

New Zealand’s economy contracted by 0.7% year-on-year in the first quarter of 2025, slightly better than market expectations of a 0.8% decline, following a 1.3% drop in the previous quarter. The annual downturn was mainly driven by a 3.1% contraction in goods-producing industries, though this marked an improvement from the 5.6% decline recorded in Q4. Service industries stagnated, posting no growth after a modest 0.1% rise in the prior quarter, while primary industries expanded by 1.7%, slightly up from 1.5% previously. Despite the annual weakness, the economy showed resilience on a quarterly basis, with GDP growing 0.8% in Q1, up from 0.5% in Q4. This marked the second straight quarter of quarterly growth, suggesting a gradual recovery is underway.