Thursday 31st March 2011
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Business confidence plunged in the March National Bank Business Outlook survey, which is seen as the most comprehensive survey of business sentiment since the magnitude 6.3 earthquake on February 22.
A net 8.7% of businesses expect worse times for the economy over the coming year, compared to a net 34.5% in February expecting better times.
While a net 14.7% expect better times for their own business over the year ahead, compared to a net 36.6% in February.
Investors were waiting to see the post-earthquake measure of confidence, and ahead of the release of the report economists said the difference between the overall and people's own business measures would be interesting.
"To put the decline in perspective, this is the second largest one-month decline in business confidence in the history of the survey," National Bank said. "Only during the heart of the global financial crisis have we seen a larger fall."
Canterbury experienced the largest decline in confidence. Headline confidence fell a whopping 92 points. Firms' own activity expectations in the region declined 55 points from a net 47 positive to a net 8 percent pessimistic. Profit expectations and employment expectations also plunged.
"Stripping Canterbury out of economywide numbers still shows the same trend: confidence is down across each segment. The implication is simple: this is far from a local issue. It's an economy-wide challenge."
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