New Zealand QSBO for Q4 2021, business confidence headline -28% (prior -11%)

From the New Zealand Institute of Economic Research

business confidence -28%

• prior -11%

capacity utilisation 89.5%

• prior 96.1

From the NZIER:

• business confidence and demand fell as the COVID-19 outbreak dragged on
• survey was carried out from 8 November 2021 to 10 January and captured the effects on Auckland and its neighbouring regions in lockdown and domestic and international border restrictions.
• With new COVID-19 variants emerging and overwhelming healthcare systems in other major countries, uncertainty over how the pandemic will evolve remains high, and businesses have become more cautious about investment.
• manufacturing sector is the most downbeat
• services sector was also particularly downbeat in the December quarter
• building sector is feeling pessimistic as cost pressures continue to intensify
• Labour shortages constrain businesses

On cost pressures & inflation:

• A net 61 percent reported increased costs in the December quarter – the highest level since June 2008.
• Over half of businesses raised prices in the December quarter, and a net 65 percent plan to increase prices in the next quarter. These results point to inflation pressures in the New Zealand economy remaining strong over the coming year.

Previous Q3 report is here