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

 


NZ business confidence falls from 20-year high in 2Q

NZ business confidence falls from 20-year high in 2Q as growth moderates

By Tina Morrison

July 8 (BusinessDesk) - New Zealand business confidence declined from a 20-year high in the second quarter as economic growth moderates.

A net 33 percent of businesses were optimistic in the June quarter, seasonally adjusted, from a net 51 percent in the first quarter, according to the New Zealand Institute of Economic Research’s Quarterly Survey of Business Opinion. The New Zealand dollar dipped to 87.38 US cents from 87.49 cents immediately before the release.

The survey showed a net 31 percent of firms expect improved economic conditions in the quarter ahead, down from a net 35 percent in the previous quarter, while a net 15 percent experienced a pick up in activity in the second quarter, down from 24 percent in the first quarter. The survey is consistent with growth moderating from strong levels, with annual gross domestic product moderating to 2.8 percent in the second quarter from 3.8 percent in the first quarter, the NZIER said.

“Things are still pretty good but the momentum is coming off,” said Shamubeel Eaqub, principal economist at the NZIER. “The economy is still growing but the pace of growth may be starting to come off a wee bit.”

Costs pressures are constrained and are likely to remain so for the foreseeable future, Eaqub said. However capacity pressures are starting to come through and prices are beginning to rise with consumer price inflation heading towards 2.5 percent by the end of this year, he said.

Firms reporting a rise in average costs edged up to a net 20 percent from a net 19 percent in the first quarter while a net 23 percent experienced price rises, up from a net 16 percent in the first quarter.

The survey comes as the Reserve Bank is expected to raise the benchmark interest rate this month, following three rises this year. Eaqub said he doesn’t think the bank should raise rates any further.

“We should hold here to see what is happening with the economy,” he said.

A net 93 percent of financial services firms expect interest rates to rise, up from a net 87 percent in the previous survey.

Those firms seeing profit growth eased in the latest quarter, to a negative 4 percent from positive 3 percent in the previous quarter, as sales volumes slowed.

The survey showed capacity pressures building, with capacity utilisation increasing to a net 90.6 percent from 89.4 percent in the previous quarter. The NZIER said the pressures were most acute for builders and those facing the domestic economy, rather than exporters.

(BusinessDesk)

© Scoop Media

 
 
 
 
 
Business Headlines | Sci-Tech Headlines

 

Future Brighter Money: RBNZ Releases New Bank Note Designs

New Zealand’s banknotes are getting brighter and better, with the Reserve Bank today unveiling more vibrant and secure banknote designs which will progressively enter circulation later next year. More>>

ALSO:

Commerce: Supermarket Inquiry Finds No Breaches By Countdown

The Commerce Commission inquiry into anti-competitive behaviour by Countdown supermarkets, alleged by former Labour Party MP Shane Jones, has found nothing to warrant prosecution, although it warns supermarkets to take care in the way they communicate... More>>

ALSO:

Crown Accounts: English Flags ‘Challenge’ To Budget Surplus

Finance Minister Bill English is warning next month’s half yearly fiscal and economic update from the Treasury may not forecast a budget surplus, saying that returning the government’s accounts to surplus in 2015 will be “a challenge”, given the decline in commodity prices and weak global inflation. More>>

ALSO:

March 2015: Netflix To Launch In Australia And New Zealand

World’s Leading Internet Television Network to Offer Original Series, Movies, Documentaries, Stand-Up Comedy Specials and TV Shows for Low Monthly Price More>>

ALSO:

Price Of Cheese (Is Up): Dairy Product Prices Fall To Five-Year Low

Dairy product prices fell in the latest GlobalDairyTrade auction to the lowest level in more than five years, led by declines in rennet casein and skim milk powder. More>>

ALSO:

Gordon Campbell: On The Australians Scoring Trade Points Against Us With The Chinese

It hasn’t been a great year for Trade Minister Tim Groser... To top it off, Australia has just signed a FTA with China that has far better provisions on dairy exports than what New Zealand currently enjoys in our own FTA with China. More>>

ALSO:

Iwi & Local Consultation: Oil And Gas Block Offer 2015 Begins

Energy and Resources Minister Simon Bridges today announced the start of the Block Offer 2015 process for awarding oil and gas exploration permits. More>>

Industrial Action: Stats NZ Throwing Public Money Away Duplicating Data

The Public Service Association (PSA) says Statistics NZ are throwing money away by collecting the same data twice for official statistics such as the Consumer Price Index... As part of the ongoing industrial action, field interviewers who are PSA members are continuing to collect data, but are not sending it through to Statistics NZ. More>>

ALSO:

Other Stats:

Space: Rosetta's 'Philae' Makes Historic First Landing On A Comet

After more than a decade traveling through space, a robotic lander built by the European Space Agency has made the first-ever soft landing of a spacecraft on a comet. More>>

ALSO:

Get More From Scoop

 
 
Standards New Zealand

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