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New Zealand economy grows strongly in Q3 but recession clouds loom

Central bank expected to crank up rates in fight against 3-decade-high inflation

Sunbathers enjoy the sand at Oriental Bay in downtown Wellington, New Zealand. Tourism, construction and transport led third-quarter growth. (Sipa via AP Images)   © AP

WELLINGTON (Reuters) -- New Zealand's economy saw surprisingly strong growth in the third quarter, fueling expectations the central bank will continue its aggressive rate hiking cycle as it tries to get inflation at three-decade highs under control.

While growth in the quarter was broad-based with tourism, construction and transport leading the way, signs of an impending slowdown caused by high interest rates and falling housing prices are starting to appear.

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