There's been a big lift in business confidence over the past month, with the construction industry at the forefront of renewed optimism.
The latest National Bank Business Outlook survey for August released this afternoon, shows a net 34 per cent of respondents expect an improvement in business conditions in the year ahead, up 16 percentage points from July.
A net 64 per cent of respondents in the construction industry expect better times ahead. This is a level not seen since the early 1990s.
Companies' own activity expectations also improved. A net 26 per cent expect better times ahead for their own business, which is close to a five-year high.
"There is no doubt a better feel-good factor is developing, despite the unemployment rate moving up sharply," said Cameron Bagrie, chief economist of National Bank.
Virtually all the survey indicators improved in the August survey. The only indicator to turn down was commercial construction intentions. But this was more than compensated by a net 48 per cent expecting improved times in residential construction.
Bagrie warned that a "mini-boom" in the house market risked exacerbating existing problems and a return to "borrow and spend" habits.
The renewed exuberance seemed to be premised on a quick return to "normal" conditions in the property market, he said.
Export intentions rose to a 10 month high with 21.2 per cent expecting an improvement, up from 14.2 per cent in the last survey. Ease of credit recorded a positive 6.4 per cent reading in a turn around from a negative 15.1 per cent reading last month.
- NZPA
