New Zealand GDP Grows 0.8% in Q1, Beats Expectations

New Zealand GDP Expands 0.8% in Q1 2025, Surpassing Forecasts

WELLINGTON – New Zealand’s economy grew by 0.8% quarter-on-quarter (QoQ) in the first quarter of 2025, exceeding analysts’ expectations of a 0.7% increase, according to Statistics New Zealand. This marks an acceleration from the revised 0.5% growth in Q4 2024.

Despite the quarterly improvement, the year-on-year (YoY) figure remained negative, with GDP shrinking 0.7%, though this was a milder contraction than the -1.3% recorded in Q4. The result beat the projected YoY decline of 0.8%.

Economic Momentum Builds Despite Annual Decline

While the annual figures continue to show a contracting economy, the better-than-expected quarterly performance may signal the beginning of a turnaround for New Zealand’s economic outlook in 2025.

The growth was reportedly driven by strong performances in key sectors such as:

• Professional services
• Healthcare
• Manufacturing
• Retail trade

📈 Related Reading: What Drives GDP Growth in Developed Economies?

Revised Q4 Figures Show Slower Growth

The previous quarter's GDP growth was revised down from 0.7% to 0.5%, making the Q1 beat more notable. These updated figures reflect better data integration and refined measurements by Statistics New Zealand.

💡 For deeper insight into NZ’s economic data, explore our Macroeconomics Explained series.

Looking Ahead

With back-to-back positive QoQ results, New Zealand may be positioning itself out of a technical recession. Economists will now be closely watching inflation, interest rate policy from the Reserve Bank of New Zealand (RBNZ), and global trade dynamics to assess the sustainability of this growth.

Stay informed with more updates on New Zealand’s Economy.