- ANZ Bank New Zealand
Business confidence in New Zealand continued to decline in March, particularly in the agricultural sector. ANZ Bank's business survey showed a net 3% of companies are positive about the prospects for the nation's economy over the coming year, compared with a net 7% in the preceding survey. Optimism remains high in the construction sector amid low interest rates and Auckland's housing shortage, while the services sector is also upbeat. However, the mood in the agricultural sector continued to darken, with a net 46% of firms anticipating conditions to deteriorate, reflecting the impact of lower dairy prices.
While companies were concerned about the New Zealand economy, optimism about their own prospects rose, from a net 26% to 29%, and a net 13% expect bigger profitability in the coming year, compared to 12%. Firms reduced their export expectations to a net 21% from 23% in February. ANZ's composite growth indicator, which combines its business and consumer confidence reports, indicates the economy will grow between 2.5% and 3.5%. At the same time, Treasury forecasts growth averaging around 2.7% a year over the next five years. While the uncertain global outlook remains a concern, Treasury secretary Gabriel Makhlouf said the domestic economy was strong, supported by record visitor and migrant arrivals and low interest rates.
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