Business confidence falls in May

Business confidence fell further in May. Photo / 123RF

• Business confidence fell 12 points to +37 in May.
• Expected own activity fell 13 points to +35.
• Late-month responses were higher than earlier-month ones.

ANZ’s Business Outlook survey shows confidence slipped further in May.

Business confidence fell 12 points to +37 in May, while expected own activity fell 13 points to +35.

However, late-month responses were higher than earlier-month ones.

“The main messages coming out of our Business Outlook survey are that the economy is recovering, but that it’s still hard-going here and now,” said ANZ chief economist Sharon Zollner.

“Like last month, there were movements within the month that were masked by the headline figures – this time in a positive direction as the global turmoil settled down.”

Zollner said there was still plenty of scope for more volatility.

“But for now, some of the initial hit to confidence, own activity expectations, profitability, and investment intentions has dissipated, with these indicators well off their late-April lows.”

Westpac senior economist Michael Gordon said the improvement in responses towards the end of the month suggested an element of reading headlines and watching share prices.

“While the main confidence measures are still above their long-run averages, they are now down substantially from the highs seen at the end of last year,” he said.

Gordon said the May survey was the first month where all respondents will have had time to absorb United States President Donald Trump’s ‘Liberation Day’ tariff announcement and the subsequent developments.