New Zealand: Business confidence drops for second consecutive month in September
September 30, 2011
According to the business confidence indicator published by the National Bank of New Zealand (NBNZ) in September, a net 30.3% of firms expect better economic conditions for the coming year. The reading was down 4.1 points over the previous month's survey, when a net 34.4% of businesses expected better economic times over the following 12 months. Despite the drop, the index remains well above the 0-point threshold, which indicates that optimistic respondents outnumber pessimists. In its statement, the Bank commented that ?with global financial markets on the alert, it was only natural for respondents to take a wait-and-see approach.? That said, the fall in confidence was felt across all sectors. Businesses' perception of their own activity declined compared to the previous month and firms' profit expectations for the year ahead also slipped compared to August. Moreover, business investment prospects deteriorated, with a net 11.1% of respondents to the September survey expecting better times to invest in buildings, plants and machinery in the next 12 months. This reading was down from August's net 12.3% of respondents.
Author: Ricardo Aceves, Senior Economist