16 Dec 2008

World economic crisis effect still uncertain - Treasury

2:02 pm on 16 December 2008

Treasury has lined up with the Reserve Bank and said the country is coming out of recession, but uncertainty surrounding the outlook for the world economy means it cannot be sure if this will last.

Treasury secretary John Whitehead said growth will remain sluggish for some time and the numbers of unemployed will increase until mid 2010.

By then, he said, it is forecast that New Zealand will be coming out of the slowdown, however it remains an uncertain situation.

"We've probably never been in so much uncertainty as we are at the moment in forecasting, and the truth is I think nobody knows for certain."

John Whitehead said the fiscal impact of the recession on the government's books in the December economic and fiscal update on Thursday will be more significant than most people realise.