So according to the Stats NZ figures, the quantity of durable consumption goods (cars, appliances, furniture, drills etc) purchased fell very quickly during the March quarter. Now they have been dropping for a while – but this drop was off the charts.
Durable goods are seen as a “leading indicator” (in combination with durable investment products). It appears that the sharp falls for durable consumer goods have only just got kicking, while the sharp falls in durable investment goods started only mid-late last year. Since the recession started in the March quarter of 2008 this is all a bit surprising.
Given that unemployment has only hit 5%, and non-residential building has yet to fall (both lagging indicators), as well is this indicating that the recession is only really beginning for NZ. Has the past 15 months been some type of rebalancing that wasn’t really a recession – and is the recession coming now.
I think that is the worst case scenario we could pull out of recent data – if we really wanted to 😉