New Zealand: Business confidence moves further into pessimistic territory in June
June 28, 2019
The ANZ bank business outlook indicator fell by 6.1 points in June, with a net 38.1% firms reporting that they expect general business conditions to deteriorate this year. The headline reading therefore moved further below the net-0% threshold that separates pessimism from optimism among businesses. June’s result largely reflected falling profit expectations, and growing concerns over tighter credit conditions.
Meanwhile, firms’ positive outlook regarding their own activity—a metric which has a stronger correlation to GDP growth—ticked down to a net 8.0% in June, after reporting a net 8.5% in May. Notably, the activity outlook for the manufacturing, agriculture and services sectors deteriorated from the previous month, while the outlook for the construction sector improved substantially.