New Zealand: Business confidence drops in February
February 27, 2017
Economic sentiment among New Zealand businesses deteriorated in February. The ANZ Bank Business Outlook indicator showed that a net 16.6% of surveyed firms expected better economic conditions in the next 12 months, which was below December’s print of 21.7% (the survey is not conducted in January). The indicator remained comfortably above the net-0% threshold that separates optimism from pessimism among firms, where it has been since October 2015. February’s dip in business confidence comes as the economy faces business cycle headwinds that could soon threaten to slow the momentum of production across sectors, but it does not reflect a weakening of the country’s economic fundamentals.
ANZ reported that February’s slip reflected growing pessimism in the construction and agriculture sectors. Sentiment improved in retailing, while in the service and manufacturing sectors it remained broadly unchanged. Investment intentions eased slightly in February, after climbing to a nearly two-year high in December. Meanwhile, firms reported marginally lower willingness to hire more staff.