New Zealand businesses are feeling more positive than they have in more than a decade. The latest ANZ Business Outlook survey shows a strong lift in confidence, supported by better past activity and steady inflation expectations.
Business Confidence Jumps Sharply
According to the November survey, headline business confidence rose nine points to a net 67 percent. This is the strongest result since 2014 and reflects a clear improvement in how firms see the economic landscape.
The measure that economists watch more closely, known as expected own activity, also rose to its highest level in over ten years. It increased eight points to a net 53 percent. This suggests that companies expect stronger trading conditions and better results in the months ahead.
Improvement Seen Across Most Sectors
ANZ says that reported past activity, which is often the best indicator of real economic growth, lifted across almost every sector. The only exception was construction, although that sector has also improved from earlier lows.
“Green shoots are looking well established,” said ANZ chief economist Sharon Zollner. She added that it was encouraging to see confidence growing because businesses are experiencing better activity, not just hoping for it. “Things are looking up,” she said.
Inflation Expectations Remain Stable
The survey shows that one-year-ahead inflation expectations are steady at 2.69 percent. This keeps inflation near the top of the Reserve Bank’s target range.
With economic recovery taking shape, ANZ does not expect the Reserve Bank to cut the Official Cash Rate again unless unexpected conditions arise.
Other inflation signals in the report were mixed. More firms expect to increase their selling prices in the next three months, reaching the highest level since March. However, the number of firms expecting cost increases eased slightly.
Regional Performance Mixed but Improving
ANZ reports that Wellington remains the weakest region for both experienced and expected activity, although it has also improved compared with previous months.
Activity has strengthened across most regions, with notable gains in Auckland and in the South Island outside Canterbury.
Outlook
The survey paints a brighter picture for New Zealand’s economy as 2025 comes to an end. Rising business confidence, steady inflation expectations, and stronger past activity suggest that the recovery is gaining momentum.
Economic conditions remain challenging for some sectors, but the overall trend points toward improved confidence and renewed growth.
