Confidence slumps again in BNZ survey last week

The BNZ's email survey of business and consumer confidence last week has found a net 40% of respondents expected the economy to get worse over the next year, which was significantly worse than the net 20% who saw the economy deteriorating in early October. The October result was itself down sharply from a net 26% positive in September. "Economic conditions are deteriorating rapidly offshore and the New Zealand economy will feel some strong negative effects over 2009," said BNZ economist Tony Alexander. "Businesses appear highly aware of what is going to hit our shores and the coming year will be quite challenging for the new government," Alexander said. "Over the coming year we are likely to see a potentially strong decline in net inward visitor flows, reduced demand for manufactured exports, further dents to consumer and business sentiment, and continuation of the existing downturn in residential construction," he said. "This downturn now looks like spreading into non-residential construction given the concerns businesses have about existing and prospective cash flows." * This article was first published yesterday in our daily subscription newsletter for the banking and finance industries. The email costs NZ$365 per annum and carries exclusive news and analysis for New Zealand banking and finance industry executives, regulators and investors. Sign up for a free trial here.