Business Confidence Index
Published: June 15, 2023This report analyses trends in the business confidence index. The data for this report is sourced from ANZ's monthly Business Outlook Survey. Business confidence is calculated as the net balance of responses to a survey of about 1,500 businesses which asks respondents to rate the expected future state of their business and the overall economy. When the index is at 100, the number of optimistic and pessimistic responses are equal. The index is positive when more businesses are optimistic and negative when more are pessimistic. The report uses the average of monthly index values over each financial year and is measured in index points.
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Recent Trends – Business Confidence Index
IBISWorld forecasts the business confidence index to climb by 0.8 index points in 2024-25, to average 107.0 index points. Inflation is expected to trend downwards in the current year, supporting an anticipated improvement in the business confidence index. The Reserve Bank of New Zealand (Te Putea Matua) is likely to start reducing the cash rate over the year as inflationary pressures begin to ease. This trend is anticipated to place upwards pressure on business confidence. Yet, an elevated cash rate environment is anticipated to curb further hikes in business confidence.
New Zealand's early success in containing the virus' spread contributed to a steady recovery in business confidence following the initial national lockdown and COVID-19-induced recession. Business confidence remained mostly positive over the first half of the 2021 calendar year. However, further outbreaks and subsequent lockdowns contributed to confidence levels dropping into negative territory.
5-Year Outlook – Business Confidence Index
IBISWorld forecasts the business confidence index to average 110.8 ...
