Video | Agriculture | Confidence | Economy | Energy | Employment | Finance | Media | Property | RBNZ | Science | SOEs | Tax | Technology | Telecoms | Tourism | Transport | Search

 


NZ business confidence at highest level in almost 20 years

NZ business confidence rises to highest level in almost 20 years; New Zealand dollar jumps

By Tina Morrison

Feb. 28 (BusinessDesk) – New Zealand business confidence rose to its highest level in almost 20 years in February, indicating strong economic growth this year.

A net 70.8 percent of firms are optimistic about general business conditions this month, up from 64.1 percent in December and the highest level since March 1994, according to the ANZ Business Outlook survey. The New Zealand dollar jumped as high as 83.95 US cents from 83.61 cents immediately before the 1pm release, and was recently trading at 83.93 cents.

Firms seeing a pickup in their own business activity rose to 58.5 percent from 53.5 percent in December, the highest reading since June 1994. Expected profitability of 44.6 percent is up from 39.7 percent in December and at the highest level since April 1994.

A net 32.4 percent expect to hire more staff, up from 24.7 percent in December and the highest level December 1992, while investment intentions at 35.2 percent is up from a previous reading of 21.8 percent and the strongest since March 1994.

The strong survey results are despite headwinds from an elevated currency and the expectations from a net 90 percent of respondents that interest rates will rise over the coming year. While the ANZ’s composite indicator of business and consumer confidence is signalling the potential for 6 percent annual growth by mid-2014, capacity constraints and a weak national balance sheet rule out that growth trajectory, and suggest growth of about two thirds that pace, at 4 percent, is more likely, ANZ said.

“That’ll be good enough to propel New Zealand to the Top of the Pops – topping the OECD growth stakes – so-called ‘Rock Star’ status,” ANZ Bank New Zealand chief economist Cameron Bagrie said. “But we need many more years of solid gold economic growth – underpinned by ongoing productivity improvements – to secure our place in the rock and roll Hall of Fame. We’re simply up at a time a host of others are in rehab.”

Interest rates are set to move higher, given the survey results show a net 32.9 percent of firms expect to raise prices, a higher trend for inflation expectations of 2.6 percent and with pricing intentions in the construction sector at the highest since 1992, ANZ said.

While not hitting such highs, other measures in the survey are robust, ANZ said, citing investment in livestock, residential and commercial investment intentions and export intentions.

(BusinessDesk)

© Scoop Media

 
 
 
 
 
Business Headlines | Sci-Tech Headlines

 

Scoop Business: RBNZ Keeps OCR At 3.5%, Signals Slower Pace Of Future Hikes

Reserve Bank governor Graeme Wheeler kept the official cash rate at 3.5 percent and signalled he won’t be as aggressive with future rate hikes as previously thought as inflation remains tamer than expected. The kiwi dollar fell to a seven-month low. More>>

ALSO:

Weather: Dry Spells Take Hold In South Island

Many areas in the South Island are tracking towards record dry spells as relatively warm, dry weather that began in mid-August continues... for some South Island places, the current period of fine weather is quite rare. More>>

ALSO:

Scoop Business: Productivity Commission To Look At Housing Land Supply

The Productivity Commission is to expand on its housing affordability report with an investigation into improving land supply and development capacity, particularly in areas with strong population growth. More>>

ALSO:

Forestry: Man Charged After 2013 Death

Levin Police have arrested and charged a man with manslaughter in relation to the death of Lincoln Kidd who was killed during a tree felling operation on 19 December 2013. More>>

ALSO:

Smells Like Justice: Dairy Company Fined Over Odour

Dairy company fined over odour Dairy supply company Open Country Dairy Limited has been convicted and fined more than $35,000 for discharging objectionable odour from its Waharoa factory at the time of last year’s ”spring flush” when milk supply was high. More>>

Scoop Business: Dairy Product Prices Decline To Lowest Since July 2012

Dairy product prices dropped to the lowest level since July 2012 in the latest GlobalDairyTrade auction, led by a slump in rennet casein and butter milk powder. More>>

ALSO:

SOE Results: TVNZ Lifts Annual Profit 25% On Flat Ad Revenue, Quits Igloo

Television New Zealand, the state-owned broadcaster, lifted annual profit 25 percent, ahead of forecast and despite a dip in advertising revenue, while quitting its stake in the pay-TV Igloo joint venture with Sky Network Television. More>>

ALSO:

Get More From Scoop

 
 
Computer Power Plus

Standards New Zealand

Standards New Zealand
 
 
 
 
 
 
 
 
Business
Search Scoop  
 
 
Powered by Vodafone
NZ independent news