The pace of activity is cooling as net migration inflows ease, house prices level off and the effects of the exchange rate appreciation spread from the export sector to the economy at large. Together, these factors will reduce pressures on stretched resources and close the output gap, bringing growth onto a more sustainable medium-term path. With the economy likely to head towards a soft landing, the current “wait and see” stance of monetary policy is appropriate, as is the broadly neutral stance of fiscal policy. With potential growth slowing because of weaker population growth, the policy initiatives currently being developed should aim at encouraging greater labour force participation, thus providing a helpful boost to medium-term growth prospects...