April 2025 NZ Economy – What Everyday Kiwis Need to Know
Short on time?
Prices are easing, the Reserve Bank made loans a bit cheaper, confidence is ticking up, but the Government’s books are still deep in the red. House prices have finally stopped falling and the kiwi dollar is hovering around 62 US cents.
1. Prices at the shops are finally calming down
Official data show everyday prices grew 2.5 % over the past year, the softest reading in three years. Food and petrol were the biggest helpers.
2. Borrowing just got a touch cheaper
The Reserve Bank cut the Official Cash Rate by 0.25 % to 3.5 %. This means banks can lower mortgage and business-loan rates, though it may take a few weeks to flow through.
3. Kiwis a little less gloomy
The ANZ-Roy Morgan survey says consumer confidence jumped from 93 → 98.3. Above 100 is “optimistic”, so we’re not there yet but heading the right way.
4. Government still in deficit
Treasury expects a NZ$17 billion gap in this year’s budget and no surplus before 2029, meaning less room for big spending promises.
5. House prices creep higher
CoreLogic’s index says national values rose 0.5 % in March. Lower mortgage rates and fewer listings are giving the market a gentle push.
6. Tourism gets a boost from new visa rules
From 1 April, easier “digital-nomad” and investor visas aim to pull in high-income visitors and fresh capital. Officials hope this will pump more money into local cafes, hotels and startups.
7. The economy is growing again (but only just)
After last year’s recession, the economy grew 0.7 % in late 2024, helped by tourism and retail. Analysts still warn growth is fragile.
8. Kiwi dollar sitting near US$0.62
The currency has been steady in a 0.60 – 0.65 band as traders balance lower NZ rates against hopes for US rate cuts.
9. So, what should everyday Kiwis do?
- Mortgage holders: ask your bank about refixing – two-year rates have dipped ~0.20 %.
- Savers: term-deposit rates may slide, so shop around and consider laddering your deposits.
- First-home buyers: stabilising prices give you breathing room, but deposits are still hefty.
- Investors: a weaker kiwi can lift export earnings; check if your portfolio is diversified outside NZ.
FAQ
- Will the Reserve Bank cut rates again?
Markets give about a 40 % chance of another cut at the 22 May meeting. - Could prices fall below 2 % soon?
Economists think CPI will glide to ~2.2 % by late-2025 if there are no fresh global shocks. - Is now a good time to lock in a home-loan?
If you need certainty, today’s lower rates may be worth fixing part of your loan; just remember rates could fall further.
Kiwi Money Matters is written and maintained by a New Zealand-based writer with hands-on experience in finance and accounting since 2015.
All posts are personally researched, written to ensure clarity and trustworthiness for everyday Kiwis.
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