New Zealand: Business confidence gains some ground in August
The ANZ bank business outlook indicator rose in August. As a consequence, a net 47.8% of firms reported that they expect general business conditions to worsen in the year ahead, improving from a net 56.7% of firms expecting bleaker general business conditions in the year ahead in July. As a result, the headline remained below the net-0% threshold that separates pessimism from optimism among businesses.
Business grew less downbeat with regards to ease of credit, investment intentions and commercial construction.
Meanwhile, firms’ outlooks regarding their own activity—a metric which has a stronger correlation to GDP growth—increased to a net minus 4.0% in August from a net minus 8.7% in July.
Commenting on the release, Sharon Zollner, chief economist at ANZ, stated:
“New Zealand businesses are well aware that the Reserve Bank is on a mission to cool demand to bring it back into line with – indeed, below – the economy’s ability to meet it, in order to reduce inflation. In that context, while mildly rebounding activity indicators are ostensibly good news, today’s survey was not particularly encouraging for the RBNZ.”