New positive signs for the economic recovery cycle in New Zealand 

New Zealand economy is showing great signs of economic recovery to get rid from the effect of earthquake that hit the country as exports rose significantly, especially from dairy products and meat from countries of the Asian region, especially from China.

The New Zealand economy is starting the recovery phase this period, after the home building permits accelerated during the month of January by the most in almost two years, reflecting the residential construction rebound after the earthquake. 

The New Zealand economy issued today data regarding the building permits for the month of May, which accelerated to 2.2% compared to the previous drop by 1.6%, while the market expectations referred to 3.2%.

New Zealand’s goods prices rose dramatically which is positive for growth rates and profits, but it’s a negative effect on the currency of New Zealand, led to decline in exports, in addition to that high prices may be dangerous if growth rates continue to climb this way. 

On the other hand, New Zealand's trade balance registered a surplus in May less than expected as it recorded a surplus of NZ $605 million compared to the previous surplus which amounted to $1113 million New Zealand dollars, which was expressed by Mr. Alan Pollard, President of the Central Bank, that higher New Zealand dollar led to a decline in export earnings, which may explain the reason for this decline in the surplus. 

Retail sales is one of the important indicators that indicate consumers spending, where we can see that the improvement in New Zealand's retail sales index in November gives further upbeat signals that the economy might recover and fight the financial crisis before the first half of 2011 along with the borrowing costs near their lowest levels. 

In the meantime New Zealand's central bank monitors the global situation like any other central bank, especially in the face of rising oil prices and food commodities in addition to the current instability stemming from the Greek crisis and the sluggish U.S. economy, which impacted other global economies, especially after the decline in consumer confidence in the United States. 

Finally, through these global events linked to all global economies, and what we have said of the high oil and commodity prices and fluctuating global economy, which may worry monetary policy makers in New Zealand to prepare for any potential inflationary risks in the coming period.