New Zealand business confidence rebounds in Q4

[WELLINGTON] New Zealand business confidence rebounded in the fourth quarter, suggesting the central bank will keep interest rates on hold in 2016 in the face of solid economic growth, a private think tank said on Tuesday.

A net 15 per cent of firms surveyed expected general business conditions to improve versus -14 per cent in the previous quarter, the New Zealand Institute of Economic Research's quarterly survey of business opinion (QSBO) showed.

The survey showed demand continued to pick up, with a net 18 per cent of businesses reporting an increase in their own trading activity in the December quarter. "This suggests solid GDP growth over the first half of 2016," NZIER senior economist Christina Leung said. She noted, however, inflation indicators remain subdued.

On a seasonally adjusted basis, a net 13 per cent of firms expected general conditions to pick up, versus -10 per cent in the previous survey.

The survey's measure of capacity utilisation was 93.2 per cent, from the previous quarter's 92.3 per cent.

REUTERS