WELLINGTON -- Growth in China is continuing to buoy up the New Zealand economy, while New Zealand's other main trading partner, Australia, is slowing, a leading business group announced Monday.

The Business New Zealand Planning Forecast indicated that the economy was continuing to grow, with export prices staying high and economic growth forecast to average just over 3 percent for the next two years.

"Our two major trading partners, China and Australia, are looking quite different, raising concerns about the state of the Australian economy," said the forecast.

"While China's projected growth rate has dropped slightly to a still healthy 7.5 percent per annum, Australia's fortunes have taken a tumble over the last 18 months."

Improved business and consumer confidence and continued solid growth prospects for China, New Zealand's largest export customer, were among the positive indicators in the current quarter, while growth prospects in Australia, the country's second largest export partner, were muted, Business New Zealand economist John Pask said in a statement.

One concern in the domestic economy is increasing household debt levels, he said.

"Debt is increasing at a time when servicing costs are relatively low and interest rates are at historic lows. There is a danger that when interest rates rise again, households may get into strife if the economy falters," Pask said.