Business confidence has perked up but remains deeply pessimistic.
A shop closed under the Covid-19 alert level 4 lockdown. Photo: RNZ / Nate McKinnon
ANZ's preliminary monthly survey showed headline confidence sitting at a net 46 percent pessimism level from 67 percent last month.
The more closely followed own activity measure improved by 13 points to a net 42 percent, saying things would get worse over the next 12 months.
All the main activity indicators - exports, profits, investment, and jobs - showed modest improvements but were still deeply negative.
ANZ chief economist Sharon Zollner said the lessening of negative sentiment was a glimmer of light at the end of a long tunnel.
"Reducing virus cases to negligible levels sharply reduces a huge downside risk for businesses, but it's clear that very tough times nonetheless lie ahead."
Zollner said more than 60 percent of respondents were doing less business than this time last year, and close to a third had fewer workers.
She said the economic damage caused by the Covid-19 lockdown was only starting to emerge.
The survey results cover the first week of the month, which includes the move to level 3 lockdown.
Zollner said the hit to the economy was also keeping a lid on inflation, with businesses largely unable to pass on rising costs and looking at inflation of 1.28 percent in a year's time.
