Key facts
- New Zealand business confidence rose in the third quarter.
- A net 43% of firms surveyed expected general business conditions to improve.
- This compares to 8% optimism in the previous quarter.
- 42.9% of businesses expect conditions to improve.
- Over 62% of firms plan to invest in the next 12 months.
- 76% of businesses expect costs to rise.
New Zealand's business confidence saw a significant increase in the third quarter, with a net 43% of firms expecting general business conditions to improve. This marks a substantial rise from the 8% optimism recorded in the previous quarter, according to the New Zealand Institute of Economic Research's quarterly survey of business opinion.
Business Central's latest survey also indicates a firming of business confidence across central New Zealand, with businesses shifting from a defensive stance to preparing for recovery. Chief Executive Hayley Horan noted a significant jump in confidence in the national economy, aligning with ground-level observations. Expectations for the national economy have nearly doubled since the prior quarter, with 42.9% of businesses anticipating improvement.
While expectations for individual financial performance have slightly eased from their peak, nearly half of businesses still foresee improvement over the next year, with most others expecting stability. A key indicator of this growing confidence is investment, with over 62% of firms planning to invest in the next 12 months, up from 58.8% in the previous quarter. Horan highlighted this willingness to invest as a strong signal that businesses are looking beyond short-term pressures and preparing for growth.
Cost pressures remain the primary constraint, though concerns have eased slightly, with 76% of businesses expecting costs to rise compared to 87.5% in the last quarter. Other ongoing concerns include consumer confidence, productivity, and global uncertainty. Businesses also expressed more positive sentiment about the country's direction, with 44.9% believing New Zealand is on the right track.