Photo: 123RF
- Headline business confidence eases a shade but overall upbeat
- More closely followed own activity improves further
- Firms doing better business than a year ago
- Better profits, investment, hiring expected
- But a few inflation niggles emerge
Business confidence has eased slightly this month, but remains upbeat as firms report a lift in sales and expectations of further improvement.
The ANZ survey showed sentiment dipped three percentage points to a net 62 percent confidence level, having peaked at a 10-year high in October.
Chief economist Sharon Zollner said the more closely followed "own activity" measures showed firms doing better business than a year ago, and a majority now forecasting an increase in the future.
"[The] survey showed more signs of demand recovering, with the first decent lift we've seen in past activity, which is the best GDP indicator in the survey ... it's certainly not strong in level terms, but it's clear that the economy has turned a corner.
"Thank goodness, one would have to say, after this morning's very weak Q3 GDP outturn. The bar for things to improve from here is clearly pretty low," Zollner said
Stats NZ data showed the economy slipping into recession in the middle of the year with two quarters of 1 percent contraction.
Signs of better times, but some clouds
The survey showed businesses expecting better profits, to hire more staff, and greater investment, with the construction industry the most optimistic.
There are signs in the survey of returning confidence in the construction sector. Photo: Photo / 123RF
But the survey also showed the inflation bogey had not disappeared, with a jump to 70 percent in firms expecting higher costs, and an increase in inflation expectations to 2.63 percent.
"We'll put it down to volatility for now, but will watch it closely," Zollner said.
And concerns about finding skilled staff have re-emerged as an increasing worry generally for businesses, but for retailers the top issue was turnover and sales.
The issue was the big obstacle for businesses in 2022/23 until the surge in migration filled shortages. However, immigration has flattened and considerable numbers of New Zealanders are moving overseas.
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