Business confidence remained at or near historic lows last month, but at least it did not get any worse.
In the National Bank's monthly survey of firms' views of their own outlook over the coming year, their profit expectations and their investment and employment intentions remain at levels consistent withthe economy contracting 3 per cent, chief economist Cameron Bagrie said.
A net 39 per cent expect general business conditions to get worse over the year ahead, an improvement from a net 41 per cent in February. The net figure subtracts the number of pessimists from the number of optimists.
Those of a "glass half-full" disposition could see the figure as a positive, Bagrie said.
"You have to stop falling before you can rise, or crawl before you can walk," he said.
"Everyone is in a holding pattern, knowing it is going to be a tough year."
A net 21 per cent of firms expect their own activity to decline, down from 20 per cent in February and only marginally better than the all-time low of 22 per cent in December.
A net 28 per cent expect to have fewer staff, up only marginally from 29 per cent in February, while investment intentions weakened with a net 19 per cent expecting to invest less, a new low.
"Export intentions fell further with a mere net 2 per cent expecting growth, and that is prior to the recent run-up in the currency," Bagrie said.
But inflation pressures continue to ease with the net balance of firms expecting to raise their prices falling from 15 per cent in February to 9 per cent - a six-year low.
The global scene remained precarious and at home there was no shortage of job loss stories.
"More encouraging news is that dairy prices have found a base, the grass is growing and we're seeing more New Zealanders stay as opposed to heading off for the big OE."
The Reserve Bank was looking for a martini glass-shaped recovery in the second half of the year.
Bagrie said he would happily drink to that - but he is not buying it.
The current account deficit had to be reduced which meant shedding debt, especially on the part of the household sector.
With much of the rest of the world in the same boat an export-led recovery was not in the offing either.
"So where is the growth going to come from?" Bagrie said.
