New Zealand cut its growth forecast for the fiscal year ending June 30, citing soft business investment and population growth.

The country's Treasury trimmed its GDP growth forecast for the fiscal year to 2.1% from the 2.9% estimated in December 2018. Factors including trade and financial market conditions, the exchange rate, business confidence and profitability weighed on the country's business investment, the Treasury noted.

The Treasury expects growth to accelerate to 3.2% in the next fiscal year before easing in the next years until 2023 amid tight monetary conditions, declining population growth and the reduced effect of government impetus. The average GDP growth across the five years to June 2023 stands at 2.6%.

Net core crown debt is estimated at around 20.1% of GDP in the 2018/19 fiscal year and is expected to drop to 18.7% by 2023.

The New Zealand government also unveiled its first "well-being" budget, which increases the annual operating allowance for 2019 to NZ$3.8 billion from NZ$2.4 billion previously. The operating allowance for the 2020 budget also rose to NZ$3.0 billion from NZ$2.4 billion.

S&P Global Ratings now expects that New Zealand's general government budget will post a surplus in fiscal year 2023, delayed by a year.

As of May 30, US$1 was equivalent to NZ$1.54.