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ANZ Business Outlook preliminary results for May saw a rise in 'forward-looking activity indicators' but levels remain very low

ANZ Business Outlook preliminary results for May saw a rise in 'forward-looking activity indicators' but levels remain very low

Better in relative terms, but still well and truly down in the dumps. That's the initial reading from the ANZ Business Outlook for May.

This is the statement from ANZ:

The preliminary ANZ Business Outlook data for May saw a small bounce across all forward-looking activity indicators, but levels remain extremely low.

Business confidence jumped 21 points to -46 while own activity lifted 13 points, with a net 42% of firms expecting lower activity for their firm in the year ahead.

“All forward-looking activity indicators lifted from April levels but they remain extremely weak. Backward-looking indicators are deteriorating. Pricing and cost indicators remain very subdued,” said ANZ Chief Economist, Sharon Zollner.

“Deflationary pressures remain evident. Expected costs remain near lows, pricing intentions are still negative, and one-year-ahead inflation expectations are at just 1.28%, a record low.

“As New Zealand emerges from a highly successful lockdown there’s a glimmer of light, but it’s at the end of a very long tunnel. Reducing virus cases to negligible levels sharply reduces a huge downside risk for businesses, but it’s clear that very tough times nonetheless lie ahead.

“The economic damage wrought by the lockdown is only starting to emerge; Level 2 still isn’t ‘normal’ for many businesses; and the global situation remains dire.”

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9 Comments

Ray Dalio makes good sense. Calm minds make rational decisions. Right now we need world leaders tobe rational towards each other. Work together to make a fair and functioning world economy. Isolationism never works.

'cost indicators remain very subdued' . Bit surprised at this. We are seeing some solid price increases for imported products as the NZD trends down.

That's probably because several importers are being forced to absorb higher import costs while reducing selling prices on their goods and services (hence the negative pricing intentions) by both taking a hit on their margins and cutting costs wherever they can, just to turn stock over into cash to keep their businesses afloat.

If we were to run an economy on the above expectations we'll be broke this time next year.

We will be broke some time this year.

Just after the election !

We're not broke already?

Noticeable that the two YoY indicators (Activity, Employment) have both dived more negativerish.....

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Days to the General Election: 37
See Party Policies here. Party Lists here.