ANZ New Zealand Business Outlook: Feeling the Pressure

Significant Decline in Business Confidence Amid Global Uncertainty

In March, business confidence experienced a sharp drop of 26 points, falling from 59 to 33, as companies began to assess the possible effects of recent events in the Middle East. Survey responses collected later in the month showed an average of -23, highlighting growing concern. Other key indicators that predict future activity also saw notable declines.

Looking at current impacts, the proportion of businesses reporting stronger performance compared to the previous year decreased from 23% to a net 18%. The retail sector was hit especially hard, dropping 20 points to just +5, while construction fell 16 points to -13. Late-month responses averaged out at zero, suggesting a challenging outlook for the coming month.

Meanwhile, inflation pressures intensified, as reflected in higher inflation indicators.