New Zealand ANZ Business Confidence dropped sharply from -3.8 to -14.2 in August. Own Activity Outlook dropped from 26.3 to 19.2. Looking at some more details, export intentions ticked down from 7.6 to 7.4. Investment intentions dropped from 17.4 to 14.4. Employment intentions dropped from 21.4 to 17.0. Profit expectations dropped from 0.0 to -5.5. Inflation expectations, however, rose further from 2.70 to 3.05, above RBNZ’s target band. ANZ said that the “initial responses after level 4 lockdown look encouragingly robust”.
ANZ also noted while Delta is a “formidable opponent”, there are some reasons to the “glass-half-full about the situation”. The economy had “significant momentum” going into the lockdown. People will be a lot more confidence than last time regarding their job. Also evidence there and overseas suggests that the bounce out of lockdowns tends to be vigorous. But it’s still too soon to be sure when the level 4 restrictions will stamp out Delta.
