Dairy windfall reshapes ASB's regional economic rankings
ASB's Regional Economic Scoreboard for the June 2026 quarter found sharp divergence between regions, with Canterbury, Taranaki, and Southland taking the top three spots on the back of dairy and meat sector strength, including Fonterra's capital return payout, while Auckland and Wellington continued to lag.
Auckland's housing market was singled out as a persistent weak point
Auckland slipped a further place to sixth in the rankings. Its housing market was singled out as a persistent weak point, with both prices and sales down significantly on a year ago. Bay of Plenty recorded the sharpest fall of any region, dropping from first to 11th, while Gisborne slid from fifth to 13th, sharing the bottom of the table with Wellington.
Canterbury's broad-based strength
Canterbury returned to first place after finishing second the previous quarter, underpinned by solid consumer spending, population growth, and a resilient labour market. Core retail sales in the region grew 8.8% year-on-year, the strongest of any region, while employment rose 2.6% annually and unemployment fell to 3.6%, among the lowest nationally. House prices in Canterbury also lifted 3.3% over the year, bucking softer conditions elsewhere.
ASB acting chief economist Kim Mundy (pictured) said the region's performance reflected multiple factors working in its favour at once.
"Canterbury has the full package right now," Mundy said.
Taranaki delivered the biggest turnaround of the quarter, climbing from second-last to second place, with construction activity up 47.1% year-on-year and new vehicle registrations rising 21.6%. Southland rounded out the podium in third, with house prices and sales both climbing at the fastest annual pace of any region.
A subdued national backdrop, apart from exports
Against the regional divergence, the national picture for the quarter was more mixed. Inflation rose above 4%, unemployment reached an 11-year high, and the housing market softened further. Export demand was the standout exception, with export volumes up 6.4% over the quarter and 10% annually, supported by firm dairy, meat and wool prices and a weak New Zealand dollar.
That resilience in exports wasn't enough to drive stronger overall growth: fresh Stats NZ figures show national GDP grew just 0.2% in the quarter, with construction up 2.7% and retail trade and accommodation down 1%.
The RBNZ started lifting the cash rate again in July, adding a second increase in September to bring it to 2.75%. ASB expects two further 25 basis point hikes in October and December.
For advisers, the scoreboard's regional divergence — strong dairy-exposed provinces against a soft Auckland and Wellington — points to widening differences in client borrowing capacity and housing market conditions depending on location.
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