"But it's still pretty clear the depreciation pressures on the Australian dollar are coming from two major sources: the decline in terms of trade and a stronger US dollar"
- Richard Grace, Commonwealth Bank of Australia chief rates strategist
Business confidence in New Zealand improved for the second straight month, with confidence rising in the agriculture, manufacturing and services sectors, ANZ Bank's business outlook survey showed. The ANZ Business Confidence index hit the highest level in four months at 31.5 in November, up from 26.5 in the previous month, with a figure above zero indicating optimism, while a figure below pointing to pessimism. Companies expecting an improvement in their activity soared to a net 41.7%, compared with 37.8% last month. This year-high was recorded in February, when business confidence surged to 70.8.
Since the beginning of the year outlook for the New Zealand's economic growth have slowed, with the Treasury cutting its gross domestic product projections to 2.8% in the year through March 2015, compared with a previous estimate of 4%. Meanwhile, the RBNZ Governor Graeme Wheeler has paused his tightening cycle, after hiking the official cash rate 100 basis points to 3.5% between March and September. Nevertheless, the survey also revealed a net 25.4% of companies expect interest rates to rise further, a drop from a net 54% a month earlier. Inflation expectations were slightly changed at 2.14% down from 2.48%, with a net 20.2% expecting to raise their own prices, down from 24.2%. Those intending to hire more staff rose to a net 20.1% from 19.4% in October.
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