The ANZ Business Confidence Index in New Zealand declined unexpectedly to -44.3 in July 2019 from -38.1 in the previous month and missing market estimates of -34.9. That was the worst reading since August last year, when the index was at -50.3. Employment intentions slumped (-5.5 vs 0) as firms sought to cut jobs, capacity utilization weakened to its lowest since 2009 (0.4 vs 5.3), and activity outlook (5.0 vs 8.0) and export expectations (1.4 vs 5.3) deteriorated. In addition, profit expectations fell further(-16.3 vs -12.5), while investment intentions turned to negative (-0.3 vs 2.5). Meantime, pricing intentions were little-changed (22.5 vs 22.6), amid an ease in cost pressures (46.7 vs 49.7), with inflation expectations edging down to near 2-year low (1.81 vs 1.87). Among sectors, commercial construction (-20.0 vs 4.8) and residential buildings (-15.8 vs 0.0) fell back to negative territory, indicating a rapid fall in activities ahead. Business Confidence in New Zealand averaged 4.49 percent from 1970 until 2019, reaching an all time high of 80.90 percent in February of 1994 and a record low of -76.40 percent in December of 1974.
Business Confidence in New Zealand is expected to be -32.00 percent by the end of this quarter, according to Trading Economics global macro models and analysts expectations. Looking forward, we estimate Business Confidence in New Zealand to stand at -20.00 in 12 months time. In the long-term, the New Zealand Business Confidence is projected to trend around 15.00 percent in 2020, according to our econometric models.