New Zealand: Business confidence plunges further into pessimistic territory in August
The ANZ bank business outlook indicator fell by 8.0 points in August, with a net 52.3% of 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. August’s result again reflected falling profit expectations, growing concerns over tighter credit conditions, and falling employment intentions.
Meanwhile, firms’ positive outlook regarding their own activity—a metric which has a stronger correlation to GDP growth—declined to an over a decade low of net minus 0.5% in August, after reporting a net 5.0% in July. Notably, the activity outlook for the services and manufacturing sectors deteriorated significantly from the previous month.