Gross Domestic Profit March Quarter 2012

Economic activity, as measured by gross domestic product (GDP), grew 1.1 percent in the first three months of 2012, Statistics New Zealand said today. This strong growth follows revised growth of 0.4 percent in each of the previous three quarters.

Compared with the March 2011 quarter, economic activity in the March 2012 quarter was up 2.4 percent. For the year ended March 2012, economic activity was up 1.7 percent compared with the year ended March 2011.

"This quarter we saw growth spread across a number of industries, while in previous quarters the industry picture had been more mixed with growth in some industries offset by falls in others," national accounts manager Rachael Milicich said.

The main contributors to the increase in economic growth this quarter were, by industry:

• manufacturing (up 1.8 percent), due to increases in primary food manufacturing and metal product manufacturing
• business services (up 2.0 percent), which include professional, scientific, technical, administrative, and support services
• agriculture (up 2.3 percent), mainly driven by an increase in milk production.

"Continued good growing conditions have been a major factor in the growth this quarter, and is reflected in both the milk production in agriculture and in meat and dairy manufacturing," Ms Milicich said.

The expenditure measure of GDP was up 0.8 percent in the March 2012 quarter. The main features of this growth were:

• Investment in fixed assets, up 1.7 percent, mainly due to new investment in plant, machinery, and equipment.
• The supply of goods produced exceeded demand this quarter leading to a $416 million build-up in inventories. Manufacturing production was up and more goods were imported, while exports fell 1.7 percent.
• The volume of spending by New Zealand households increased 0.1 percent. While household spending in New Zealand fell this quarter, New Zealanders increased their spending abroad on overseas holidays.

The size of the economy (in current prices) was $202 billion for the year ended March 2012.