Europe's woes continue to weigh heavily on world economies as the World Economic Forum of the global business elite starts at Davos, in Switzerland.
Craigs Investment Partners broker Chris Timms said European debt was the biggest issue facing the global economies and it was unsettling for financial markets.
New Zealand should get through the worst of it unless the dollar continued its trajectory higher, he said.
Yesterday, the New Zealand currency reached a three-month high against the US dollar.
"The swings from one extreme to another are happening very quickly and it is making things difficult for investors.
"But Europe is not an issue that can be resolved quickly. It will take years; a generational issue."
One of the problems was no cohesive solution being proposed by European leaders. Each country had its own agenda and "political egos" were getting in the way of a resolution, he said.
One of the fortunate things for New Zealand was that Australia and Asia were still buying New Zealand commodities.
"Things would be much worse if exporters were relying on Europe and the United Kingdom to take the country's products, Mr Timms said.
A survey released yesterday by accountancy firm PwC showed European business leaders were the most pessimistic, amid fears governments were not up to the task of resolving their debt crises and concerns about the stability of capital markets.
The survey of 1258 bosses found 48% expected economic decline and only 15% growth.
"CEOs are disappointed with the course of the global economy and the pace of recovery. The optimism that had been building cautiously since 2008 has begun to recede," PwC International chairman Dennis Nally said at the release of the survey.
While the gloom was deepest in the developed economies of Western Europe, confidence was down even in the larger emerging markets which many experts hoped would be a source of growth for the rest of the world.
China saw the largest decline in confidence in the Asia-Pacific region with only 51% of chief executives feeling "very confident", down from 72% last year.
In India, a belief in revenue growth dropped from 88% to 55%.
No New Zealand chief executives were interviewed for the survey.
The Reserve Bank will this morning release its Official Cash Rate decision, which everyone expects will be to keep the OCR at 2.5%.
Analysts will be watching for any indication from Reserve Bank governor Alan Bollard that the European cash crisis is affecting the way he views the domestic economy.
Federated Farmers' mid-season farm confidence survey, conducted earlier this month, revealed farmer confidence in the general economy had turned negative for the first time since July 2009.
Europe and the global economy increasingly weighed upon farmer outlook, president and economic spokesman Bruce Wills said yesterday.
"Concerns about sovereign debt, volatility in global financial markets and weakened economic activity has potential to spread outwards from the euro zone especially."
While the drop in farmer confidence was in line with other surveys, the good news was that farmers' confidence in their own profitability remained strong, despite being down on what it was at the start of the season in July, he said.
The release of the survey coincided with the International Monetary Fund warning the euro zone debt crisis was escalating and could derail the global economic recovery.
The IMF cut its 2012 forecast for global growth to 3.3% from 4% just three months ago, saying the outlook had deteriorated in most regions. It projected world growth would strengthen to 3.9% next year.
The world economy was already weak and was in danger of stalling, IMF chief economist Olivier Blanchard said at a news conference. The world could be plunged into another recession if the European crisis intensified.
The United States and other advanced economies would probably not escape unharmed if Europe's crisis escalated.
ASB chief economist Nick Tuffley said Europe remained the main source of risk to global prosperity this year.
"We continue to expect the most likely outcome is that Europe contains and defuses the crisis over time.
"But the risk of a fumble - unwittingly or otherwise - is significant, given the potential consequences."
Mr Tuffley expected New Zealand would continue with its gradual recovery, on the assumption Europe avoided triggering a global financial meltdown.
However, it was extremely likely that financial market volatility was going to remain an issue for businesses and investors to deal with.
"Europe's decision makers are progressing at a glacial pace and more focused on preventing the next crisis rather than swiftly solving the current one.
"Consequently, the danger period in which something calamitous could happen will be drawn out," he said.
