New Zealand Business Confidence August 2016

New Zealand

Business confidence decreases marginally in August due to seasonal factors

Economic sentiment among New Zealand businesses fell slightly in August, marking a second consecutive decline. The ANZ Bank Business Outlook indicator showed that in August a net 15.5% of surveyed firms expected better economic conditions in the next 12 months, which was marginally lower than the 16.0% recorded in July. Despite the decline, the business confidence indicator remains above the 0% threshold that separates optimists from pessimists.

ANZ said that August’s print mainly reflected a moderation in economic sentiment in the construction sector. In the agricultural sector, confidence among firms remained depressed, despite recording the largest jump in the month. Nonetheless, ANZ noted that the mild drop in overall confidence in August reflected purely seasonal factors and that, “the story is very robust when you dig a little deeper. After adjusting for seasonality, business confidence hit a 20-month high in August.”

FocusEconomics Consensus Forecasts panelists expect fixed investment to grow 3.7% in 2016, which is down 0.5 percentage points from last month’s estimate. For 2017, the panel sees fixed investment accelerating to 3.5%.


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