New Zealand: Business confidence retreats in February
February 28, 2019
The ANZ bank business outlook indicator dipped further into pessimistic territory in February, losing more than a half of December’s gains. A net 31.0% of surveyed firms reported that they expect general business conditions to deteriorate in the year ahead (December: 24.1%). In turn, the headline reading remained below the net-0% threshold that separates pessimism from optimism among businesses. February’s 6.9-percentage-points fall reflected reduced investment expectations, lower employment intentions and poorer perception of the availability of credit.
Meanwhile, firms’ positive outlook regarding their own activity—a metric which has a stronger correlation to GDP growth—eased a net 10.5%, after reporting a net 13.6% in December. A sharp deterioration in the activity outlook for the construction sector drove the downturn, despite light improvements in the retail and agricultural sectors.
New Zealand Fixed Investment Forecast
FocusEconomics Consensus Forecast panelists expect fixed investment to grow 2.8% in 2019, which is unchanged from last month’s forecast, and 2.8% in 2020.