Figure 9 New Zealand: per capita real GDP  Source: Statistics New Zealand, RBNZ  BIS central bankers’ speeches  9  In mid 2012, New Zealand’s GDP per capita is still around 3 per cent below its previous peak (reached back in December 2007).
In addition, the fiscal deficit was expected to exceed the Maastricht Treaty’s deficit ceiling of 3% for the third year in succession, hence limiting the scope for fiscal action. Policymakers were well aware of the seriousness of the situation, and economic and social policy reforms had been already initiated. However, strong headwinds in pushing through those reforms were to be expected.