Firms' profit expectations take a dive
Although firms' overall outlook remains positive, the latest National Bank business confidence survey reports the third successive monthly drop.
Business confidence has taken another hit.
Although firms' overall outlook remains positive, the latest National Bank business confidence survey reports the third successive monthly drop.
A net 13% businesses are positive about the overall economy, down from a net 30% positive a month ago.
When asked about their own activity, the picture is a bit better: a net 26% are positive, back on the historic average, which is not bad considering the global economic backdrop, said chief economist Cameron Bagrie.
Profit expectations, though, have taken a big hit, with only a net 2% reporting a positive outlook, down form 15% last month
"On the face of it, this does not augur well for investment and employment, critical elixirs of sustained economic expansions," Mr Bagrie said.
The survey comes less than 24 hours before the Reserve Bank is due to review interest rates again.
Tomorrow morning governor Alan Bollard is to review the official cash rate (OCR). However, even before today's business confidence survey, Dr Bollard was expected to keep the OCR at its current 2.5% level.
Rob Hosking
Wed, 26 Oct 2011
Wed, 26 Oct 2011
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Firms' profit expectations take a dive
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