New data shows the South Island's West Coast has driven economic growth in the months after the Omicron variant of COVID-19 hit the country.
The high-performing region has been boosted by construction and dairy, with the latter's payout expected to be up by $73 million from the previous year.
Its economy grew by 4.2 percent in the year to June.
However, Development West Coast chief executive Heath Milne said momentum in the region appeared to have stalled since June.
"Inflation in New Zealand has reached levels not seen in over 30 years, so it's little surprise we're seeing a drop in consumer confidence.
"Like the rest of the country, we're experiencing severe skills and labour shortages which are constraining our growth."
The national gross domestic product (GDP) figure was a rise of 0.9 percent in the year to June, according to Infometrics.
It's welcome news after GDP shrunk by 0.2 percent in the first quarter of this year, according to Statistics NZ. It was a shock to most economists after a 3 percent rise in the December 2021 quarter.
"The West Coast and upper North Island areas including Northland, Auckland and Waikato were some of the stronger performing regional economies in the June 2022 quarter.
"Underlying economic activity has picked up since the earlier peak in Omicron cases in March, as New Zealand moved to orange and spending activity rebounded," Infometrics principal economist and director Brad Olsen said.
Like the West Coast, however, Olsen said growth across New Zealand had been more restrained in recent months.
"A tight labour market provides a strong foundation for regional economies but is also piling the pressure on, as short-term sickness and a continued brain drain of young talent make it hard to resource current levels of business.
"Around half the current net migration outflow from New Zealand is young people, presenting a key constraint on provincial economies, which are struggling to source the talent needed.
"The path ahead for regional economies remains uncertain, with New Zealand facing a range of negative influences including weak confidence, high inflation, rising interest rates, a tight labour market and ongoing supply chain disruptions. However, these negatives will be mitigated by the border reopening, reduced COVID case numbers and less restrictive trading conditions outside red," Infometrics said.
