6 Oct 2009

Business confidence 'highest for 10 years'

4:27 pm on 6 October 2009

Business confidence is at its highest level in a decade.

The latest quarterly survey of business opinion by the New Zealand Institute of Economic Research (NZIER) shows business confidence surging into positive territory in the September quarter.

In contrast to the previous survey, a net 36% of companies expect general business conditions to improve in the next six months.

A net 25% of them previously expected conditions to worsen.

The NZIER says the survey provides strong evidence that the worst of the recession is over and the economy is on the mend.

Principal economist Shamubeel Eaqub says most indicators are now heading in a positive direction, albeit from low levels in most cases.

But the gap between current conditions and firms' expectations - the largest in 39 years - remains a concern, he says: a lack of follow-up by firms in new hirings and investment suggests the recovery could be much weaker.