New Zealand: Business confidence dips to an over-decade low in July
The ANZ Bank Business Outlook indicator showed that a net 44.9 of surveyed firms were pessimistic about the year ahead in July, a higher proportion than June’s 39.0% and marking the lowest reading since May 2008. As a result, the indicator moved further below the net-0% threshold that separates optimism from pessimism among firms. Confidence declined across all surveyed industries in July, with the manufacturing and construction sectors recording the largest drops.
Similar to the dip the confidence reading, firms’ positive outlook regarding their own activity—a metric which has a stronger correlation to GDP growth—fell from plus 9.4 points to 3.8 points, the lowest level since May 2009. Firms’ intentions to invest and profit expectations experienced a marked decline. Moreover, a sizeable number of firms still foresee credit difficulties ahead.