NZ: Business confidence eased in February - ANZ

Cameron Bagrie, Chief Economist at ANZ, notes that the New Zealand’s business confidence eased in February while other survey indicators were reined in slightly; agriculture dominated but a broader slowing is natural as we enter a mature and capacity-constricted stage in the economic expansion.

Key Quotes

“Inflation expectations continue to nudge up and more firms think the next move for interest rates is up.”

“The first punt on Business Confidence for 2017 has a grindstone look about it. The tote continues to favour the optimists over the pessimists; a net 17% of businesses are optimistic about the year ahead. That’s down 5 points on December. Large drops were recorded in the construction and agriculture sectors while sentiment improved in retailing. The service and manufacturing sectors were broadly unchanged.”

“Businesses are still trotting along nicely though are marginally less upbeat when it comes to their own firm. A net 37% of businesses expect better times for their own business. The 3pt dip – if we can call it that – needs to be put in perspective. This series averaged 34 over 2016 and has a long-run average of 28. Businesses are still on the upbeat side of the ledger.”