Earthquake econmic impact not yet fully known

9:48 am on 22 September 2010

NZIER economist Shamubeel Eaqub says widespread uncertainty about the economic impact of the Canterbury earthquake, is making it hard to forecast when household spending will pick up.

Economic forecasters polled as part of the New Zealand Institute of Economic Research's latest quarterly consensus report, have pared their expectations for economic growth in the coming year.

They now expect the economy to expand by 2.8% in 2011, 0.5% less than what was forecast in June.

Growth expectations for 2012 have been also been trimmed to 3.1%.

Mr Eaqub says current estimates about the economic impact of the earthquake are still too preliminary.

He says economists are becoming increasingly divergent in their views , and it will be some time before the real effect is known.

The magnitude 7.1 earthquake occurred on 4 September.