New Zealand Retail Sales To Be The Main Engine To Support Nation's Economic Growth

The New Zealand retail sales improved in November, hoping to be the
main support for the nation's economic growth during the fourth
quarter of 2010, while market's expectations noted that spending
performance in New Zealand rebounded and it is on the track to improve
the economy.

The economy of New Zealand released data on the retail sales and the
retail sales excluding auto during the month of November. The actual
reading of the retails was 1.5% compared to the previous reading of
-2.5%, where expectations were referring to a rate of 1.1% revised to
-2.4%.

The retail sales excluding auto showed an actual reading of -0.2%
compared to the previous reading of -1.6%, while forecasts were
referring to value of 0.5%.

New Zealand economic growth unexpectedly contracted 0.2% in the
quarter of July to September, compared with a previous expansion in
the second quarter, due to the consumer spending declined along with
the worst earthquake that hit the nation in 80-year decades that
causing a great damage in growth rates, and affecting negatively on
housing industry and manufacturing.

On the other hand, the benchmark interest rates in New Zealand will be
at their level during the first half of the year, because of the RBA
aims to support the economy to exist from its hurdle.

Retail Sales index is one of important indicators that indicating to
consumers spending, where we can see that the improvement in New
Zealand retail sales index in November may help the economy to
recovery and fight its financial crisis before the first half of 2011
along with the keeping borrowing costs near of their lowest levels.

On of the main factors that may help consumers spending to increase is
the labor market improved during the period, with the improvement in
labor market will fuel income of workers, supporting the spending
cycle on goods and sales.

Inflation rates in New Zealand wouldn't be a problem that facing the
nation during the first half of the year, while the Bank aims to keep
inflation in a secure range between 1% and 3%.
Source: ActionForex.Com