17 December 2004 Media Statement

Confidence survey promises good summer

The latest National Bank business outlook showing continuing strong investment and hiring intentions promises a good summer for New Zealand workers, Finance Minister Michael Cullen said today.

He was commenting on survey results showing a net 27 per cent of companies expect to increase activity over the next 12 months, a net 20.5 per cent planning to invest more and a net 14 per cent expecting employment to increase.

“These are all positive signs but it should be remembered that headline confidence, although nine points up on November, is still in negative territory and that there are clouds on the business horizon, primarily in the form of higher interest rates and – for exporters – of the high dollar.

“Treasury is forecasting that these factors, combined with the effects of reduced migration, will pull growth back to around 2.5 per cent in the next two years,” Dr Cullen said.

ENDS

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