New Zealand Business Confidence June 2019

New Zealand

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.

FocusEconomics Consensus Forecast panelists expect fixed investment to grow 2.5% in 2019, which is down 0.3 percentage points from last month’s forecast, and 3.0% in 2020.

Author: Massimo Bassetti, Economist

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New Zealand Business Confidence Chart

New Zealand Business Confidence June 2019

Note: Percentage of respondents expecting improvement in general business conditions minus percentage expecting deterioration. An index number above 0 indicates that optimists outnumber pessimists. The survey is not conducted in January.
Source: ANZ Bank Business Outlook.

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