New Zealand: Business confidence falls to eight-month low in May
May 31, 2015
Confidence among businesses fell in May, according to the ANZ Bank Business Outlook, which reported that a net 15.7% of businesses surveyed expected better economic conditions in the coming 12 months. The figure, which came in below April’s 30.2%, represented the worst result since September 2014. As a result, business confidence moved closer to the 0% threshold that separates optimism from pessimism.
According to ANZ, business confidence decreased in 12 of the 14 categories that compose the index. Firms’ expectations for their own activity, which is an even better predictor of economic activity, decreased from 41.3 points in April to 32.6 points in May and marked a two-year low. The agricultural sector recorded the largest fall over the previous month, resulting from a high New Zealand dollar and low dairy prices. According to ANZ, May’s survey results indicate that, “the economy is transitioning into a more modest pace of expansion.”
Author: Eric Denis , Economist