National Bank chief economist Cameron Bagrie is predicting another a drop in the Official Cash Rate.
The bank's monthly business outlook shows confidence has fallen to a 20-year low amid the global financial crisis and economic downturn.
Mr Bagrie says pessimists outnumber optimists in November, with 43% of companies expecting the New Zealand economy to deteriorate in the next year, compared with a net 42% expecting a downturn in the previous survey.
Respondents remain pessimistic about their own fortunes, with a net 14% expecting their own prospects to worsen, the lowest level in 20 years.
Firms also expect lower profits, to employ fewer staff, and invest and export less.
Mr Bagrie says the Reserve Bank may slash interest rates by 150 basis points next week, bringing the Official Cash rate to 5%, and believes the weak economy would justify an aggressive rate cut.