New Zealand: Construction activity misses market expectations – Westpac

Total construction activity fell by 0.8% in the December quarter, below market forecasts. Underlying the soft headline result was a fall in non-residential construction, which can be lumpy on a quarter-to-quarter basis, according to analysts at Westpac. The overall level of building activity remains elevated.

Key quotes

“Total construction activity fell by 0.8% in the December quarter. That was lower than the 0.6% rise that we and other analysts had expected.”

“The main reason for the softer than expected December quarter result was a 3.6% fall in non-residential construction.”

“Today’s result signals some downside risk to our forecast for 0.6% growth in December quarter GDP. We’ll firm up that number as other partial indicators are released over the next week.

“We expect to see continued strength in construction activity over 2020. Dwelling consent numbers have been rising rapidly and many parts of the country are wrestling with shortages of housing.”