Economy: Recovery Not “Living Up To Expectations”…
July 23rd, 2010
A new BNZ survey has identified a plunge in business confidence, which the bank says is a result of the economic recovery failing to live up to expectations. Confidence has fallen for a third month in a row.
Only a net 2% of 542 respondents expect the economy to improve during the coming year, down from 26% in June and 56% last September. BNZ chief economist Tony Alexander says until recently the decline in sentiment since October could be put down to people becoming more realistic. He says the decline in sentiment cuts across most sectors of the economy, and reflects people seeing the economy is not as good as experts say it is. Both the legal and accounting professions report unusually poor levels of sentiment. Alexander says businesses think the Reserve Bank was wrong to raise the official cash rate.
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