WELLINGTON, June 16 (Xinhua) -- New Zealand's economic growth is set to accelerate from an estimated 3.1 percent in the year to the end of March this year to 3.8 percent in the following 12 months, according to a quarterly average of economic forecasts from financial and economic agencies published Monday.
It would slow to 2.8 percent growth in the March 2016 year and 2.1 percent in the March 2017 year, according to the Consensus Forecasts from the New Zealand Institute of Economic Research ( NZIER).
The economic recovery was broad, spreading across household spending, investment and exports, and would translate into more jobs and higher wages, but living costs and interest rates would also rise, said the forecasts.
One of the main drivers of economic growth was the country's " residential construction surge," which would continue for five consecutive years largely due to the rebuild of the earthquake- battered Canterbury region, but also because of the recovery in other areas.
Exports were expected to rebound from a "practically flat" increase of 0.1 percent the March 2014 year to a sustained growth averaging 3.1 percent over the next three years.
However, the New Zealand dollar was forecast to remain high over the next three years, it said.
Consumer price inflation would rise from an annual average rate of 1.6 percent in the March 2014 year to 2.4 percent by March 2016, putting it towards the top end of the Reserve Bank of New Zealand' s target band of 1 percent to 3 percent.
This would lead to sustained interest rate increases over the next three years, with the 90-day bank bill rate rising from 2.9 in March this year to 5 percent in March 2017, according to the forecasts.
The unemployment rate was forecast to fall from the current historically high level of 5.9 percent, towards the past decade average of 5 percent, and wages would grow at an average 3.1 percent over the next three years.
Wages growth would outpace increases in the cost of living by around 1 percent a year, supporting household spending, it said.