Business confidence – a key barometer for vehicle and equipment sales
in NZ – is now at a 15-year high, reports the ANZ Bank, today.
“New
Zealand firms recorded a further lift in their overall level of
optimism about the general economy. The general business confidence
measure lifted from +53 in October to +61 in November, just shy of a
15-year high for the series,” says the ANZ’s chief economist, Cameron
Bagrie.
“The retail sector (including the auto industry)
recorded the largest lift in confidence in November, rising from +48 to
+70, the highest across the five major divisions and the sector’s
highest reading since July 1994.
“Firms’
expectations regarding their own business prospects were unchanged, at a
14-year high of +47. On a sectoral basis, own activity mimicked the
theme in general business sentiment. The retail sector topped the lot at
+53. And similar to general business confidence, the lowest-ranked
sector ratcheted up to a 19-year high,” says Bagrie.
“Expected
profitability and labour hiring both hit 19-year highs, with respective
net balances of +37 and +23. Expected profitability was the highest in
the agriculture sector, while anticipated employment growth was the
highest for the construction sector. These results reflect the positive
tailwinds for the economy at present – high commodity prices and a
resurgence in house construction, underpinned by the Canterbury rebuild.
“An
expected lift in interest rates touched a 27-month high, as the NZ
business community becomes more cognisant of prospects for rises in the
official cash rate next year.”
Bagrie says the tone of this
month’s survey reinforces the developing theme of a business environment
experiencing renewed vigour.
“With less than a month until the
summer holidays, we see the economy riding the crest of a business
optimism wave. Our composite growth indicator portends boom times ahead:
5% growth. That’s pie-in-the-sky stuff but we agree with the spirit –
good times ahead.”
