The New Zealand Treasury's economic forecasts at this year's pre-election economic and fiscal update remain on the "rosy" side, with the eventual fiscal consolidation dependent on that outlook being realized and future governments adhering to the signaled operating and capital allowances for upcoming budgets, ANZ said in a statement on Tuesday.
Nominal gross domestic product (GDP) is projected to be about NZ$16 billion higher to June 2030 than forecast in May's budget update, with tax revenue anticipated to be NZ$11 billion higher.
Changes to the Treasury's outlook are minor and may already be somewhat outdated due to recent developments in oil prices, ANZ said.
The Treasury continues to forecast that the first post-pandemic operating surplus will occur in the year to June 2028 to 2029, estimated at 0.8% of GDP.
While it is slightly larger than the previous 0.5% forecast, it remains small enough to be affected by a minor downgrade in the economic outlook, according to ANZ.
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