New Zealand ANZ Business Confidence rose to -2.0 in April, up from March’s -4.1, much better than preliminary reading of -8.4. Own Activity Outlook rose to 22.2, up from 16.6, versus prelim 16.4. Exports intentions rose to 9.1, up from 4.5. Investment intentions rose to 17.1, up from 11.9. Cost expectations rose to 76.1, up from 73.3. Employment intentions rose to 16.4, up from 14.4. Pricing intentions rose to 55.8, up form 47.3.
ANZ said: “Given supply-side constraints are biting so hard, the confidence and robust employment intentions of firms may represent greater upside to wages and prices than to actual growth. It’s looking like a pretty inflationary soup. The RBNZ will be keen to look through cost-push inflation as far as possible, because it’s temporary…. But there’s clearly plenty of demand and risk-taking out there. The notion that the RBNZ might be overcooking things may well gain some traction in the months ahead, especially with headline inflation expected to rise above 2% in mid-2021.”
