Nicola Willis: Finance Minister on the GDP lifting 0.2 percent, according to latest data

The Finance Minister says there's still better days to come for the economy as New Zealand exits a technical recession.

Stats NZ figures show GDP rose 0.2 percent in the three months to March, and the same amount for the year.

Minister Nicola Willis says it's still tough out there for Kiwi workers - and the Government still has work to do.

"Good news is - the Government is doing everything right, we are forecasting inflation to come back under band. That means interest rates can drop and growth will recover."

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Episode Transcript

Speaker 1 (00:00):
Good afternoon. The economy grew zero point two percent in
the first quarter of this year, officially taking us out
of recession just but that figure has been propped up
by some massive immigration into the country. So the real
figure you need to look at, which is GDP per capita,
shows it actually went backwards zero point three percent. Nikola
Willis is the finance minister. Hey Nikoler, Hello Heather. That

(00:21):
number is so close to zero that I worry it's
going to get revised backwards. Were going to end up
in recession. What do you think the chances are?

Speaker 2 (00:28):
Yeah, Look, I'd rather a positive number than a negative number,
But I would be wrong to say it's all sorted. Clearly,
we have a lot of work to go. There are
going to be better times ahead for our economy. But
the numbers are telling me the same thing as the
business owners, the employers and the families are telling me,
which is it's still pretty tough out there. Inflation still

(00:48):
isn't under control, interst rates are high, and we haven't
got growth back yet. Good users, The government is doing
everything right. We are forecasting inflation to come back and
do b That means interstrates can drop and growth will recover.
We are doing everything we can and there are better
times for head.

Speaker 1 (01:08):
Do you think that we might be through the worst
of it or close to.

Speaker 2 (01:12):
I think we will feel like we're through the worst
of it when we see that first cuts to the
official cash rate. That will be the moment when people
feel some air breeze through our economy.

Speaker 1 (01:24):
I'm thinking that happens in November.

Speaker 2 (01:26):
What do you think, I'm thinking It's not my job
to predict that or to be seen to be trying
to influence the Reserve Bank governor on that. What we
obviously need to see is inflation under control. We've had
almost three years of it out of control. We are
feeling the long shadow of a government that mismanaged the
economy through fuel on the inflation fire, and we've had

(01:47):
a longer deeper inflation crisis than many other countries around
the world. Interest frates have had to go high to
sort that. Then they've now been high for a year.
That hurts. No economy can escape the pain that, So
we're now nattling down to do the work to get
inflation behind us, so the interest rates can come down
and there their bank can do its job there, and
then we've got to grow this joint. We've got to

(02:09):
grow this place, get productivity and investment going again. And
we're all about those things. And so we've now got
a government that's on the side of business and it's
very serious about lifting opportunity through everyone.

Speaker 1 (02:21):
I know that you can't I know, you can't really
actually weigh into when the ocr cut's going to happen.
But I mean, if you look at the numbers that
we're seeing at the moment, it would be really hard
to imagine that he can keep us in this place
for a long time because things are so bad, aren't they.

Speaker 2 (02:35):
Oh, there's just no doubt. There's a lot of people
who are doing it tough out there. And whether it's
families with a mortgage who are watching hundreds of dollars
without their bank account into their bank's account each fortnight,
whether it's the small businesses who are feeling fewer customers
coming through the door because they're spending all that money

(02:55):
on their mortgage. Across the economy, you're seeing pain. To
some extent. You could argue this is the recession that
the Reserve Bank governor admitted he was trying to engineer.
We are seeing the inflation numbers coming down. This is
the horrible hangover after the big spending party that the
last government imbacked on. It's not good, but we are

(03:18):
doing everything to cure it as quickly as possible so
that we can get on and grow.

Speaker 1 (03:22):
While I've got you, what do you know about this
complaint that was laid over the alleged manipulation of government
bonds by a bank?

Speaker 2 (03:28):
Well mesters to do with any complaints about financial markets
fit with the Financial Markets Authority. It's the them to
comment on. It's not appropriate for me to comment on
those matters.

Speaker 1 (03:39):
They are not saying if they've taken any action? Do
you know if they have?

Speaker 2 (03:44):
They are the only ones who are to comment on
those matters. There's a very proper separation between me as
the Minister of Finance and them. Is the Financial Market's
conduct Authority, so they look into those matters, they comment
on those matters. It's not for me to tell them
to say or to comment to musicians.

Speaker 1 (04:02):
Have you had a chat to them about maybe saying
a little bit more than they are.

Speaker 2 (04:06):
I haven't chatted to them. I did ask to be
updated on this matter because of course it's important to
me that new Zealand's bond markets are conducted with absolute
integrity and on the advice that I have received, I
do not think that there is any challenge with the
conduct of our bond markets.

Speaker 1 (04:22):
Good stuff, Nichola, thank you very much appreciated. It's Nichola Willis,
the Finance Minister. For more from Heather Duplessy Allen Drive.
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