Business confidence elevated, inflation pressure
Australia Economic Research
New Zealand: business confidence elevated and inflation pressures building
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• Headline reading of business confidence fell in 4Q
• Capacity utilization jumped
• Underlying inflation pressures building
The NZIER Quarterly Survey of Business Opinion (QSBO) released this morning showed a fall in the headline reading from a decade high +36 to a still-elevated +31. The components of the survey were strong, with firms reporting a rise in investment and employment intentions, an intention to raise selling prices as demand improves, and less spare capacity.
The headline reading suggested that a net 31% of firms surveyed last quarter expected the economy to improve in the next six months, confirming our expectation that the New Zealand economy will continue to expand in 2010 (chart).
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