Auckland tops economic scoreboard

Auckland continued to lead ASB Bank's regional economic scoreboard for the eighth consecutive time over the June quarter, but the rest of the country was a mixed bag.

The super city was buoyed by its relatively strong housing market over the quarter, the bank said.

"The region is near the top of the pack across a broad range of measures, including house sales, employment, and guest nights,'' ASB said.

"With households in the region faring relatively well, the rebound in consumer confidence has been stronger, relative to the rest of New Zealand,'' it said.

Construction activity remained weak, although this was broadly in line with the nationwide experience.

With favourable economic conditions attracting more residents and tourists to Auckland, population growth in the region outpaced the rest of New Zealand.

The Waikato and the Bay of Plenty were tied for second place behind Auckland.

At the other end of the scale, Northland had fallen back to the bottom of ASB's rankings.

Retail sales, housing market activity and construction activity in Northland remained very weak, in contrast to the improvement in these measures over the past year, nationwide.

Consumer confidence in Northland languished behind most other regions, and unemployment remained the highest in the country.

"Even though the economy is gathering a bit of momentum this year, things are a little bit uneven,'' ASB chief economist Nick Tuffley said.

"When you cast your eye around the various regions, it becomes quite apparent that we have a number of quite different things going on,'' Mr Tuffley told APNZ.

Income growth had been quite strong in the rural areas - particularly those exposed to dairy, beef, lamb, wool and to some extent logging.

"But it has not translated into strong spending growth in those areas,'' he said.

"We have seen farmers being quite cautious for quite a period - so there has been some focus on repaying debt,'' he said. "Interestingly, there has been quite strong growth in deposits from the agricultural sector going to banks, so there has been quite a bit of money that farmers are beginning to stockpile rather than spend.''

Mr Tuffley said that if rural incomes continued to hold up, those regions - particularly those exposed to dairy and meat - were more likely to show signs of life.

"For the rural areas it's just a matter of time,'' he said. "It is a very solid fundamental income story, but it is not yet translating into a spending story, and I think we will see a bit more rebalancing, with more growth coming out of those regions, and Canterbury, once rebuilding starts to pick up steam,'' he said.

Southland made one of the strongest gains during the quarter, rebounding from the bottom of the table to the top half of the rankings, on a recovery of its employment and real estate sectors.

Public sector restraint was likely to have slowed growth in Wellington during the quarter, although retail sales in the region had held up well and consumer confidence topped the country.

Otago topped the rankings for employment growth, but slipped back into the bottom half of the rankings on the overall scoreboard - reflecting a fall in retail sales, house prices, guest nights and construction activity.

The ASB/Main Report Regional Economic Scoreboard takes the latest quarterly regional statistics and ranks the economic performance of New Zealand's 16 regional economic areas.


NZ economic scoreboard

1. Auckland

2 = Waikato / Bay of Plenty

4. Nelson

5. Tasman

6. Southland

7. Hawkes Bay

8. Taranaki

9 = Canterbury / Wellington

11. Otago

12. West Coast

13. Manawatu / Wanganui

14. Marlborough

15. Gisborne

16. Northland

The scoreboard takes the latest quarterly regional statistics and ranks the economic performance of New Zealand's 16 regional council areas.


 

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