Treasury was likely to forecast economic growth close to zero for the next financial year, Prime Minister John Key said today.
He had not received any new data since last week, when he went to the Apec summit with Treasury secretary John Whitehead, and the next update would be issued on December 19 or 22, he said.
"I think it's fair to say that from the comments he's publicly made he's downgrading his estimates on growth and upgrading his estimates on unemployment," Mr Key said at his post-cabinet press conference.
"It would be fair to assume that the growth number will be pretty close to zero for the next financial year."
Mr Key said the Government was considering all its options as it finalised its economic stimulus package, but it was confident the programme it laid out before the election was still appropriate.
"We'll be looking, like others, to see what the Reserve Bank governor does on Thursday but we would be anticipating significant rate cuts," he said.
Governor Alan Bollard will release his latest review of the official cash rate on Thursday, and economists are predicting aggressive moves to bring down interest rates.
The Government was not considering bringing forward the income tax cuts due to take effect on April 1 next year, and it did not intend increasing the size of the cut, Mr Key said.
"At the moment we're confident with the agenda we've got but obviously we're considering a range of implications," he said.
"Our banking system is operating more effectively than we've seen, for instance, in the UK where the banks aren't lending as aggressively."
