30 April 2001 Media Statement

Confidence still in positive territory despite slip

"Although the latest National Bank Business Outlook shows that the uncertain world environment has reduced confidence levels, there is much within the survey data to encourage," Finance Minister Michael Cullen said today.

"The results point to a continuing strong labour market in New Zealand with almost 80 percent of respondents expecting the unemployment rate - now at a 13-year low - to either remain the same or fall.

"And the evidence suggests that the inflationary pressures in the economy have eased back substantially, with 70 percent of those surveyed saying they expect prices to remain steady or move down.

"It is also encouraging that the own activity indicator - which is more reliable because it picks up how people feel about their own firm's prospects rather than general business conditions - is still holding up well at net 37 percent positive.

"Obviously the deterioration in the United States, Australian and Japanese economies will affect sentiment here but I am confident that we have enough momentum and opportunity to carry us through a short-term downturn," Dr Cullen said.

ENDS

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