2017.08.2302:42:00UTC+00New Zealand Government Raises 2016/17 Budget Surplus Forecast, Trims GDP Projections

The government of New Zealand raised its forecast for a budget surplus in 2016/17 on a one-off rise in tax revenues, despite trimming its growth calculations for this fiscal year and next.

It increased its budget surplus forecast to NZ$3.706 billion ($2.3 billion) in the year to June due to strong corporate tax revenues, which is higher from the previous forecast of NZ$1.62 billion in its May budget economic and fiscal update.

The government also trimmed its economic growth calculation for the year to June to 2.6 percent from 3.2 percent initially, and reduced its growth expectations of 3.5 percent in the year to June of next year from 3.7 percent in the May budget update.

According to the Treasury, resilient population growth, an improved international economy and fiscal and monetary stimulus will continue to support expansion. However, it trimmed growth projections for this fiscal year and the next as a result of capacity constraints.

New Zealand has been among the quickest-growing developed economies, but first-quarter expansion fell short of expectations with construction output declining for the first time in two years.