Gross domestic product (GDP) figures to be unveiled on Thursday morning will show whether New Zealand's economy has dodged a recession.
It comes after the International Monetary Fund's (IMF) latest report on New Zealand's economy warned the Government to rein in spending and for the Reserve Bank to prepare for further interest rate hikes, should they be needed.
The financial agency on Wednesday said New Zealand's economy was likely to continue slowing in the near term.
Inflation wasn't expected to decline to the Reserve Bank's target range of between 1 and 3 percent until 2025, the IMF warned.
It also warned New Zealand's "current account balance (meaning the country is exporting less than importing) has deteriorated significantly, reflecting excess demand and one-off factors".
"For the first quarter, that [current account deficit] number came in at 8.5 percent [of GDP]," explained Mark Riggall, a portfolio manager at Milford Asset Management. "So it's an improving situation - but it's still pretty bad on the face of it."
He told AM New Zealand's tourism rebounding from COVID-19 was the major reason behind the country's slightly improving current account deficit.
"We would expect that to normalise still further so we hope it's on an improving trajectory, but at 8.5 percent… that is an unsustainable picture," he said.
On New Zealand's latest GDP figures, Riggall expected today's data will show the country has entered a technical recession.
Independent economist Cameron Bagrie agreed.
"I think we're going to see a negative number but let's be pretty careful about how we interpret that - it might satisfy the technical definition of a recession, but if you look at year-on-year growth… it's going to be up, I think, around 2 percent," Bagrie told AM.
He said New Zealand's unemployment rate remained "very low" and businesses were still "scratching for staff".
"In real terms… I still think we're a long way away from what we would call a 'real' or 'realistic' recession scenario."
