Business confidence lifts as firms shift from caution to preparation for growth

Business confidence across central New Zealand is firming, with Business Central’s latest Business Confidence Survey showing businesses slowly moving out of defensive mode and preparing for recovery.

Business Central Chief Executive Hayley Horan says the results from the final quarter of 2025 point to a clear shift in mood.

“Businesses are still realistic about the challenges ahead, but the tone is different. Confidence in the national economy has jumped, and that’s meaningful. This also aligns with what we’re seeing and hearing from businesses on the ground.”

Expectations for the New Zealand economy have strengthened significantly, with optimism nearly doubling since the previous quarter as 42.9% of businesses expect conditions to improve.

Even though expectations for their own financial performance have eased back from last quarter’s peak, nearly half of businesses still believe their performance will improve over the next year, and most of the rest expect to hold steady.

The strongest sign of confidence is investment. More than 62% of firms plan to invest in the next 12 months, up from 58.8% from the previous quarter - a clear marker that businesses are backing themselves again.

“That willingness to invest is one of the most important signals this survey gives us,” Ms Horan says. “It shows businesses are looking past short-term pressures and gearing up for growth.”

Cost pressures remain the biggest constraint, with 76% expecting costs to rise, though this is easing from the 87.5% recorded last quarter. Concerns around consumer confidence, productivity, and global uncertainty remain front of mind.

Businesses are also feeling more positive about the country’s direction, with 44.9% saying New Zealand is on the right track, and over a third saying the Government is performing better than a year ago.

Looking ahead to the 2026 election, the message from businesses is clear: the economy and the cost of doing business will dominate as the most important issues.

Horan says the results point to cautious but growing optimism.

“Businesses want predictable, long-term policy settings that make it easier to invest, innovate, and grow. If we get that right, today’s cautious confidence can turn into tomorrow’s stronger economic performance.”