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UPDATE 1-New Zealand economy bounces back with record growth as pandemic contained

 (Adds details)
    By Praveen Menon
    WELLINGTON, Dec 17 (Reuters) - New Zealand's economy grew a
record 14% in the third quarter, bouncing back from a COVID-19
lockdown earlier in the year that shut businesses and brought
activity to a standstill, official data showed on Thursday.
    Annual gross domestic product (GDP) rose 0.4%, Statistics
New Zealand said, with both figures beating expectations in a
Reuters poll for quarterly growth of 13.5% and an annual
contraction of 1.3%.
    The GDP numbers also topped the Reserve Bank of New
Zealand's November forecast of quarterly and annual growth of
13.4% and minus 1.3% respectively.
    The New Zealand dollar        was largely muted in response,
as markets had factored in a strong recovery after a sharp
contraction in the second quarter following COVID-19
restrictions. 
    Second quarter GDP was revised to a drop of 11.0% from an
initial estimation of minus 12.2%. On an annual average basis
GDP fell 2.2 percent in the year ended September 2020.
    "This is as close as you get to a true V-shaped recovery,"
said Kiwibank Chief Economist Jarrod Kerr.
    All industries recorded large increases in activity, and a
second wave of infections in Auckland in August appears to have
had a muted impact, he said.
    New Zealand is among a handful of countries that managed to
contain COVID-19 within its borders. Businesses, schools and
offices have returned to almost pre-COVID normalcy.
    The Treasury said on Wednesday it expected the country to
bounce back sooner than previously thought.             
    Fiscal and monetary stimulus has played a part in the
rebound, and today's results could move the dial on how much
further support is needed, Westpac Bank said in a note.
    "For the Reserve Bank's part, the bottom line is whether
inflation is on track to meet its mandated target. A stronger
than expected economy certainly goes in that direction, but this
needs to be balanced against other developments such as the
sharply higher New Zealand dollar," said Westpac senior
economist Michael Gordon.

 (Reporting by Praveen Menon; Editing by Richard Pullin)
  
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