New Zealand: Business confidence continues downward trajectory, still remains in optimistic territory
September 30, 2014
Confidence among businesses fell significantly in September, according to the ANZ Bank Business Outlook, which reported that a net 13.4% of businesses surveyed expect better economic conditions in the coming 12 months. The result, which came in notably below August’s 24.4%, represented the seventh consecutive monthly decline. Businesses have not had this little confidence since June 2012. Nevertheless, business confidence is still above the 0% threshold that separates optimism from pessimism.
According to ANZ, business confidence fell in 11 the 14 of the categories that compose the index. However, firms’ expectations for their own activity, which is an even better predictor of economic activity, increased marginally from 36.6 points in August to 37.0 points in September. According to ANZ, September’s retreat reflected uncertainty ahead of the past general elections as well as a change in the economy’s growth dynamics as, “the cycle is now maturing from strong growth rates off lows to moderate growth off good levels. Little wonder sentiment remains healthy.” Furthermore, ANZ pointed out that, “the economy has passed its peak; the latest GDP figures confirm a deceleration in momentum.”