NZ: Businesses confidence eased 4 points in November - ANZ

Cameron Bagrie, Chief Economist at ANZ, notes that the New Zealand’s business confidence tide ebbed in November as a net 21% of businesses are optimistic about the year ahead, down 4 points on the month prior.

Key Quotes

“That is a small move; it’s still the third-highest confidence reading of 2016. Agriculture firms are on the crest of the wave while manufacturing is in the chop.” 

“The sun is still shining down when businesses consider the outlook for their own firms. A net 38% of businesses expect better times for their own business (10 points above the long-run average), with positivity across all the five major sectors. Activity expectations within the construction sector surged to the highest reading since May 2014 while agriculture rose to a 20-month high.”

“Other key survey results included:

• Investment intentions were unchanged at +19; still in the sun and well above the historical average of +13. 
• Employment intentions remain strong at +25, led by the construction sector and backed up by agriculture, which surged to its highest result ever. More firms expect the unemployment rate to decline. 
• Profit expectations are basking at +29.
• Export intentions barely budged, moving from +25 to +23. Agriculture led with +36, its highest result in 10 years. 
• Residential and commercial building intentions eased lower. 
• Firms’ pricing intentions rose from +18 to +21 – still low. Inflation expectations rose from 1.4% to 1.5%. For the first time in nearly two years, a majority of firms expect interest rates to rise (+18).”