Bloxham said the slowdown was the result of both international and domestic factors.

International trade tensions - particularly between China and the United States - as well as the uncertainty surrounding Brexit are causing global headwinds for a country like New Zealand that relies heavily on exports.

Weak wage growth and falling housing prices in Australia also mean fewer Australians are coming to New Zealand to spend, Bloxham said.

But he also believes uncertainty domestically about Government policy and spending was influencing low business confidence and businesses' lack of investment.

"Part of it is policy-related, part of it is that they are uncertain about what the policy environment looks like... all the range of changes that could come into play that they are not quite clear on how those things are going to play out.

"The economy has also been nearing its capacity constraints, if you look at the construction industry. More needs to be delivered, but it's been harder to deliver that."

He said there needs to be an economic stimulus, calling on more Government spending.

"Both central banks, the RBA and the RBNZ, are in the process of cutting interest rates further to try and stimulate growth. Whether that will work is a big open question because interest rates are already really, really low, businesses don't think interest rates are a constraint on their ability to grow," he told The AM Show.

"The main thing we need to focus on is Governments doing more, fiscal spending supporting growth.

"Everywhere in the world, central banks are running out of room, interest rates are phenomenally low, and what we need to see is Governments step up to the plate and do more, because they can afford to."

On Thursday, economist Shamubeel Eaqub suggested giving cash to "poor people" to spend to stimulate the economy.

"Right now what we need is fiscal stimulus, right? That's the big thing that's going to work," said Eaqub. "The Reserve Bank's monetary policy's impotent. It's not going to work. At these low rates, nothing matters."