NZ: Business confidence eased slightly in August - Westpac

Shyamal Maharaj, Research Analyst at Westpac, notes that New Zealand’s business confidence and general economic confidence eased slightly during August, but remains broadly upbeat and consistent across all sectors.

Key Quotes

“New Zealand business confidence declined slightly following July’s slightly softer result. However, overall confidence remains firm compared to this time last year.”

“In particular, the construction sector has shown some rebound in their own activity outlook after a weak July result. However, pricing intentions within the construction sector have fallen. Overall, the sectors surveyed demonstrated a broadly consistent and upbeat view of the economy, with agriculture leading the pack.”

“Inflation expectations fell by 10 basis points to 1.88% (July: 1.98%) largely as a reflection of second quarter CPI data. Historically the survey has fluctuated around the quarterly CPI releases. This month’s survey reflected just that.”

“Our view for the economy remains firmly in place, following this month’s survey. Notably, the survey is in line with our view that the economy will growth around 2.5%-3% this year, notwithstanding the capacity and funding constraints that are increasingly influencing business decisions from the construction sector.”

“There was no market reaction to the release.”