Tough times ahead, 'but not recession'
2:00PM
Wednesday April 09, 2008
Alister van der Maas
Your Views
Is economic recession likely in 2008?
Most New Zealand investment managers remain optimistic the country is not heading for a recession, a survey today reveals.
Russell Investment Group's March quarter Investment Manager Outlook reports 7 out of 10 managers surveyed toward the end of March forecast lower growth for the next 12 months, but not recession.
Recession is generally defined as occurring when a country's gross domestic product (GDP) declines over two or more successive quarters, or in plain terms there is no real economic growth over six months or more.
Just two managers surveyed did think recession is imminent. One remained neutral on the subject.
Alister van der Maas, a senior consultant for Russell in New Zealand, said most of the investment managers now view the NZ market as fairly valued - in contrast to June last year when most thought it was overvalued.
Bearish sentiments were expressed by respondents on NZ equities, as well as vehicles such as NZ and international bonds.
While the majority of managers hold a neutral view on investing in NZ currency, 6 out of the 10 expect the NZ$ to fall relative to the US$.
