The latest ANZ Business Outlook survey paints a mixed picture of the outlook for recovery with overall confidence up but firms’ confidence in their own outlooks taking a hit.

Business confidence rose four points to +58 in February, while expected own activity eased one point to +45.

“The economy remains on the path to recovery as interest rates fall and our commodity export prices outperform expectations,” says ANZ chief economist Sharon Zollner.

“It seems clear from a wide range of indicators that the economy returned to positive growth in the last three months of last year.”

But whether that growth falters or strengthens from here was a point of debate, she said.

“It will depend on whether households view today’s interest rates as high or low, whether global uncertainty will constrain investment and employment or whether firms take a ‘get on with it’ attitude, and whether and when skill shortages will be a meaningful constraint on expansion.”

“Firms are confident that the ducks are lining up for better times ahead. To be fair, that’s a low bar at this point”.

Westpac senior economist Michael Gordon described the survey as having “something for everyone” with rises and falls across a range of indicators.

“All of the movements were relatively small, though – the general message remains that current conditions are tough but firms are hopeful about the year ahead."

“Firms’ numerical estimates of changes in their own costs and prices over the next three months were trending downwards, but that appears to have petered out,” Zollner said.

Firms on average expected costs to rise 2.3% over the next three months, while they expect to raise prices by 1.7% over the same period.

He noted that while firms’ expectations about their own performance dipped slightly for the month, they still remained historically high.

Hiring and investment expectations were up for the month.

Gordon noted there were marked differences across industry sectors.

“The most negative responses were from retailing (pulling back after a more upbeat Christmas/New Year period) and construction,” he said.

In contrast, the agricultural sector was faring much better than a year ago, buoyed by rising export prices and an easing in input cost inflation, he said.

“Overall, businesses remain hopeful that lower interest rates will help to revive the economy in the year ahead,” he said.

“We generally share that view, though we’re forecasting a return to moderate rather than above-trend growth over 2025.”

Topline inflation expectations were encouraging, down 0.2 of a percentage point to 2.5% in February.

But firms’ own pricing intentions continued to tick higher.

Liam Dann is business editor-at-large for the New Zealand Herald. He is a senior writer and columnist, and also presents and produces videos and podcasts. He joined the Herald in 2003. To sign up for his weekly newsletter, click on your user profile at and select “My newsletters”. For a step-by-step guide,.