Business gloom - blame it on the beaten All Blacks

By BRIAN FALLOW

Overall business sentiment ended the year on a downer - and one economist thinks the Rugby World Cup might be partly to blame.

In the National Bank's monthly survey, 33 per cent of respondents expect the general business situation to worsen in the year ahead and 17 per cent expect it to get better.

The net 16 per cent negative is a drop from a net 3 per cent negative a month ago.

National Bank economist Cameron Bagrie attributed the change to the rising dollar, expectations of higher interest rates and perhaps a pall of gloom after the Rugby World Cup semi-final loss to Australia.

The drop in confidence was most evident among manufacturers and builders.

But firms' views of their own prospects - which give a better indication of the state of economic activity - have changed little.

Investment intentions are slightly up, hiring intentions are slightly down.

Profit expectations and pricing intentions are unchanged, and export expectations have improved.

Firms' own activity outlook has risen slightly from a net 28 per cent positive to a net 30 per cent.

That was consistent with economic growth rates of 2.5 to 3 per cent over the next six months, Bagrie said.