Economic growth in the first quarter has eased slightly, with Gross Domestic Product (GDP) expanding 0.5% – in line with market expectations.

GDP per capita remains low, unmoved from the December quarter at 0.1% and 0.6% year-on-year.

The March quarter growth figure is 0.1% lower than each of the two previous quarters. As an annual measure, New Zealand’s economy grew 2.7% in the year to March.

The size of the economy is $286 billion.

The slowdown, albeit slight, was not unexpected.

Economists' consensus expectation was for half a percent increase. But Stats NZ’s growth figure came in 0.2% lower than the Reserve Bank’s forecast.

ASB, Westpac and ANZ were all picking a quarterly growth figure of 0.4%.

The figures suggest New Zealand’s economy, which for many years was one of the envies of the developed world, has shifted down a gear.

ANZ says quarterly growth figures have averaged 0.9% since 2014 – “we expect it will be difficult to achieve such strong rates of growth from here.”

One of the bank's economists, Liz Kendall, doesn't think the cycle is out in the cold just yet.

"Businesses are facing credit and capacity constraints, along with policy uncertainty and margin pressure in the face of rising costs – and these headwinds are flowing through to activity."

The numbers, especially the stagnant GDP per capita figure, will be a worry for Finance Minister Grant Robertson.

In opposition, he used that very measure to attack the Government for creating an economy of “two halves.”

Robertson has defended this criticism, levelled against him by National’s Finance Spokeswoman Amy Adams, by quoting former Finance Minister Steven Joyce – “it pays not to look at quarter-by-quarter analysis when it comes to GDP per capita growth.”

When announcing the Coalition Government in October last year, Acting Prime Minister Winston Peters warned of an impending economic slowdown.

He cited the slowdown of the housing market and the economic mismanagement of the previous Government as reasons for his prediction.

What does the data say?

Digging into Stats NZ’s data for the March quarter, the infrastructure construction sector took a hammering, down 4.9% in the first quarter following a 9.1% increase at the end of last year.

Stats NZ says this reflects the reduced rail and road activity around the Kaikoura district as main transport links reopened in December last year, following rebuilding in the aftermath of the Kaikoura earthquakes in late 2016.

Construction as a whole, including residential and non-residential housing, was down 1% for the quarter, but still up 1.4% for the year.

Aside from infrastructure construction, most other sectors in the economy are doing well.

At an industry level, 13 out of the 16 industries increased in the first quarter.

Agriculture led the charge, up 0.4%, following a 2.8% slowdown in the quarter prior.

Speaking to his post-cab press conference on Monday, Peters predicted the “sunny weather” over the summer months would put a dampener on the agricultural economy.

Household spending over the March quarter was flat, following a 1.2% increase the December quarter. This is the first quarter since 2012 household spending has not increased.