According to the most recent NZIER Quarterly Survey of Business Opinion (QSBO), business confidence increased significantly in the last quarter of 2025.
Seasonally adjusted, a net 39% of businesses anticipate improved overall economic conditions in the upcoming months.
With business confidence at its highest level since March 2014, this was a significant rise from the net 17% who anticipated a stronger overall economic outlook in the September quarter.
Additionally, enterprises’ own trading activity improved significantly; on a seasonally adjusted basis, only 3% of firms reported a decrease in their own business activity in the December quarter.
The most recent findings indicate that New Zealand’s economic recovery is beginning to take shape as the effects of reduced interest rates trickle down to the larger economy, even though the gap between business optimism and enterprises’ own domestic trading activity still exists.
Significantly, businesses’ plans to hire and invest have increased as a result of these encouraging trends.
After a long period in the doldrums and considerable monetary policy easing, the NZ Reserve Bank has finally engineered the beginnings of a recovery.
NZ house prices continued to fall in most cities in December
But as soon as employment begins to lift alongside the broader recovery in activity, this adjustment will end as well.
It appears likely that the RBNZ will now be on hold.
It is a great shame Australia did not enjoy the same correction.
The equivalent of ten years of real house price falls in Australia would cut prices by about one-third.
This would do more to fight youth protests than anything proposed by the Albanese government.
