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New Zealand Business Confidence Weakens In August: ANZ

New Zealand business confidence weakened in August after the post-lockdown rebound in July, preliminary data from ANZ showed Monday.

The business confidence index fell to -42.4 in August from -31.8 in July.

Most forward-looking activity indicators deteriorated from July. The own activity outlook index slid to -17.0 from -8.9 a month ago.

A net 15 percent of firms expect to reduce investment and a net 32 percent expect lower profits. Both readings were below thier July levels.

Conversely, capacity utilization, which correlates pretty well with GDP, improved five points to -3 percent. Compared to the same month a year ago, 7 percent of businesses reported lower activity, which was a solid improvement of 11 points versus July.

Near-term employment intentions deteriorated 6 points to a net 21 percent of firms expecting to cut jobs.

Deflationary pressures remained evident but with some mixed monthly moves. Expected costs and pricing intentions eked out small gains, but one-year-ahead inflation expectations fell slightly, the survey showed.

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