- Cameron Bagrie, ANZ New Zealand chief economist
New Zealand building consents remained virtually flat in May as falling demand in Auckland offset surging construction intentions in other parts of the country. Regional councils issued seasonally adjusted 2,151 approvals for dwellings of all types in May, up from 2,150 a month earlier, according to Statistics New Zealand. Housing consents increased 2.4% to 1,520 after the 1.8% drop in April. New dwelling consents in Auckland, the country's most populous city, declined for the first time since January, down 29% in May to 651. In annual terms, Auckland building approvals surged 6.5% in the reported month, compared with May 2014.
Meanwhile, a separate report showed New Zealand business confidence turned negative for the first time since the Christchurch earthquake in February 2011, raising the likelihood of a follow-up interest rate cut from the Reserve Bank of New Zealand as soon as next month. A net 2.3% of firms shared a gloomy outlook for the economy over the year ahead, compared with 15.7% of optimists in May, the recent ANZ Business Outlook survey showed. A net 23.6% expected their businesses to prosper in the next 12 months, down from 32.6% last month, and falling to the lowest level in three years. Agriculture appeared to be the most pessimistic sector in June, with business sentiment, profits, employment and investment intentions all negative.
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