Business confidence remains low but there was a mildly encouraging bounce in the own activity measure for businesses, ANZ chief economist Sharon Zollner says.
The Westpac-McDermott Miller consumer confidence index, also released yesterday, showed a sharp fall in household confidence.
The ANZ business outlook reported a net 38% of businesses were pessimistic about the year ahead in December, against 39% last month. Headline business confidence remained negative across all the five subsectors.
Firms' view of their own activity, which had the stronger correlation to GDP growth, lifted from seven to 16. The historic average is 28.
Ms Zollner said the economy was doing the hard yards at the moment.
Positive forces remained but the turn in housing, flattening in net migration and lack of capacity in construction were all dampening near-term growth.
The change in policy direction that came with a new government had no doubt caused a degree of apprehension among businesses, she said.
However, the reported difficulty of getting credit appeared to be easing and it might be one of the factors explaining the welcome, albeit modest, bounce in the own activity measure.
ASB senior economist Jane Turner said the ANZ business sentiment survey had a ``clear history'' of lower levels of confidence during a Labour government. As a result, ASB was not concerned by the still-weak level of business sentiment.
There were still a few areas of concern from the December survey, including low levels of investment and employment intentions.
``We will look to see further improvement in February's survey in order to reduce some of the risks to growth weak sentiment presents,'' Ms Turner said.
There is no ANZ business outlook in January.
