And signs of optimism among New Zealand's retail sector. The latest Ensediar quarterly survey of business opinion shows owners are less pessimistic about the economic outlook. So it now sits at just five percent five percent expecting deterioration in our economic conditions compared to forty percent three months ago. So that's a thirty five percentage point turnaround. Indediar says the results could make a case for another official cash rate cut next week. Christina Jung is the Enzediar Deputychef Executive and is with us this evening. Good evening, kyoder. Hey, we'll get onto the sentiment data in a couple of minutes, because I know that'll come as good news to a lot of firms out there. But let's start off with the latest trading data. What do your numbers say about demand over the last quarter.

And signs of optimism among New Zealand's retail sector. The latest Ensediar quarterly survey of business opinion shows owners are less pessimistic about the economic outlook. So it now sits at just five percent five percent expecting deterioration in our economic conditions compared to forty percent three months ago. So that's a thirty five percentage point turnaround. Indediar says the results could make a case for another official cash rate cut next week. Christina Jung is the Enzediar Deputychef Executive and is with us this evening. Good evening, kyoder. Hey, we'll get onto the sentiment data in a couple of minutes, because I know that'll come as good news to a lot of firms out there. But let's start off with the latest trading data. What do your numbers say about demand over the last quarter.

So our latest enda A quarterly serve our Business Opinion does show that demand in the September quarter remained weak, with a net thirty one percent of firms of reporting that day base reduced activity in the September quarter.

So our latest enda A quarterly serve our Business Opinion does show that demand in the September quarter remained weak, with a net thirty one percent of firms of reporting that day base reduced activity in the September quarter.

Right, okay, and how is that likely to change over the next three months?

Right, okay, and how is that likely to change over the next three months?

When we look at expectations for the next quarter. Though even though right here, right now, across a wide range of measures, firms are reporting quite weak demand in the September quarter, expectations for the next quarter are looking more positive. And that's particularly for the case for sectors such as retail and services, to the extent that these are the sectors that are more exposed to the household sector, we see the impact of law interest rates as having more of a positive impact on these areas.

When we look at expectations for the next quarter. Though even though right here, right now, across a wide range of measures, firms are reporting quite weak demand in the September quarter, expectations for the next quarter are looking more positive. And that's particularly for the case for sectors such as retail and services, to the extent that these are the sectors that are more exposed to the household sector, we see the impact of law interest rates as having more of a positive impact on these areas.

Yeah, I mean, that's that is a remarkable shift. So you've gone from well thirty one percent of firms reporting a decline in activity in the in the quarter to September, but two percent of firms are expecting weaker activity in the next quarter. So you know that that is a massive shift. And what about ninety five percent of that is down to the oci.

Yeah, I mean, that's that is a remarkable shift. So you've gone from well thirty one percent of firms reporting a decline in activity in the in the quarter to September, but two percent of firms are expecting weaker activity in the next quarter. So you know that that is a massive shift. And what about ninety five percent of that is down to the oci.

While we don't dwelve into US firms the reasons for how they're expecting or feeling the way they do. What we have seen also over the quarter is that when we ask firms, particularly we have financial services firms their expectations for interest rates. An overwhelming majority of firms are expecting low interest rates for the coming year, and the fact that we're seeing this recovery and sentiment most apparent in the retail and services sector. It does suggest that the impact of interest rates are having more of an immediate impact on these the house sector, for which these sectors will tend to be.

While we don't dwelve into US firms the reasons for how they're expecting or feeling the way they do. What we have seen also over the quarter is that when we ask firms, particularly we have financial services firms their expectations for interest rates. An overwhelming majority of firms are expecting low interest rates for the coming year, and the fact that we're seeing this recovery and sentiment most apparent in the retail and services sector. It does suggest that the impact of interest rates are having more of an immediate impact on these the house sector, for which these sectors will tend to be.

More exposed, right, So what sectors are less exposed to the household sector than it and perhaps feeling a bit more downbeat or pessimistic.

More exposed, right, So what sectors are less exposed to the household sector than it and perhaps feeling a bit more downbeat or pessimistic.

So we do see the building sector and also the manufacturing sector remains fairly downbeat. For the building sector, that reflects the fact that construction demand is still pretty weak. And also when we ask architects what their expectations are for construction work based on work in their own office, we can see that the pipeline across our housing, commercial and government construction work a week for the coming year. There are signs of an improvement beyond the coming twelve months. Though, when we are ps architects in two years time what they're expecting in terms of that pipeline of construction work, there's actually an improvement. Expectations of improvement for housing and commercial construction.

So we do see the building sector and also the manufacturing sector remains fairly downbeat. For the building sector, that reflects the fact that construction demand is still pretty weak. And also when we ask architects what their expectations are for construction work based on work in their own office, we can see that the pipeline across our housing, commercial and government construction work a week for the coming year. There are signs of an improvement beyond the coming twelve months. Though, when we are ps architects in two years time what they're expecting in terms of that pipeline of construction work, there's actually an improvement. Expectations of improvement for housing and commercial construction.

Okay, is that just down to the lag in the monthtary policy cycle? You know, basically it takes the time for the full weight of those and distrate cuts to be felt across the economy.

Okay, is that just down to the lag in the monthtary policy cycle? You know, basically it takes the time for the full weight of those and distrate cuts to be felt across the economy.

We would say part of that is the reason. Also, for example, if we look at the fact that we're firms asking them about hiring and investment intentions, despite the fact that their firms are expecting demand to pick up in the next quarter. When we ask them about their intentions expansion plans, for example, in investment, we can see that firms remain quite cautious. For example, a quarter of firms are expecting to reduce investment in buildings over the coming year. So that does suggest that while there is that expectations or hope optimism that things will improve in the next quarter when it comes to actually putting in place expansion plans. Until that our firms are feeling more conviction of a sustained improvement in demand, we do expect that that caution towards towering and investment will remain.

We would say part of that is the reason. Also, for example, if we look at the fact that we're firms asking them about hiring and investment intentions, despite the fact that their firms are expecting demand to pick up in the next quarter. When we ask them about their intentions expansion plans, for example, in investment, we can see that firms remain quite cautious. For example, a quarter of firms are expecting to reduce investment in buildings over the coming year. So that does suggest that while there is that expectations or hope optimism that things will improve in the next quarter when it comes to actually putting in place expansion plans. Until that our firms are feeling more conviction of a sustained improvement in demand, we do expect that that caution towards towering and investment will remain.

So go back to that headline figure net five percent of firms expected deterioration in general economic conditions over the coming months. Compare that though the net forty percent from the Dune quarter. What does this mean for the oc artists next week?

So go back to that headline figure net five percent of firms expected deterioration in general economic conditions over the coming months. Compare that though the net forty percent from the Dune quarter. What does this mean for the oc artists next week?

So in terms of the rebound we can in terms of that recovery and business confidence, it is looking quite a more postive picture for the news and economy. Also the fact that in this latest end are call less about business opinion. We're seeing a continue easing in inflation indicators, and that's particularly the case when it comes to pricing pressures. That's driven by the fact that in this week, demand environment booms in the manufacturing, building and retail sectors report that they cut prices in the September quarter, with the Reserve Bank highlighting that the change in price setting behavior was one of the factors that provided them with the comfort to start the easing cycle. We do see this overall picture cautious optimism, but in an easing inflation environment as supporting the case for food the OCO cuts.

So in terms of the rebound we can in terms of that recovery and business confidence, it is looking quite a more postive picture for the news and economy. Also the fact that in this latest end are call less about business opinion. We're seeing a continue easing in inflation indicators, and that's particularly the case when it comes to pricing pressures. That's driven by the fact that in this week, demand environment booms in the manufacturing, building and retail sectors report that they cut prices in the September quarter, with the Reserve Bank highlighting that the change in price setting behavior was one of the factors that provided them with the comfort to start the easing cycle. We do see this overall picture cautious optimism, but in an easing inflation environment as supporting the case for food the OCO cuts.

Yeah, twenty five or fifty, What do you reckon, Christina.

Yeah, twenty five or fifty, What do you reckon, Christina.

I've been asked that a lot, and I would say, based on today's results, you could argue the case for eager move. Really, certainly it's encouraging to see that continue decline in inflation indicator. We are expecting a twenty five basis point decline at the upcoming meeting, and that more reflects the fact that just with the commencement of the easing cycle that we're just seen in August, we're already seeing such a rebound in expectations. We feel it's prodent to be a more measured in the easing cycle in order to be able to assess the impact of the moves that it's done today.

I've been asked that a lot, and I would say, based on today's results, you could argue the case for eager move. Really, certainly it's encouraging to see that continue decline in inflation indicator. We are expecting a twenty five basis point decline at the upcoming meeting, and that more reflects the fact that just with the commencement of the easing cycle that we're just seen in August, we're already seeing such a rebound in expectations. We feel it's prodent to be a more measured in the easing cycle in order to be able to assess the impact of the moves that it's done today.

Yeah right, that makes sense. Hey, thank you so much. Christina really appreciated that. As Christina Lung, who is the Deputy Chief Executive of the enzed AA, speaking of optimism in the retail sector in Australia, that there's real reason for optimism. So retail sales have actually rebounded up almost a percent compared to expectations, so almost double the expectations, which and less over there actually just putting down to the weather they reckon it's been so warm throughout August and Australia that actually retail sales have been almost twice as good, or the growth in retail sales has been almost twice as good as they had been anticipating. So we're going to catch up with Paul Bloxam from HSBC before seven o'clock. Yet his thoughts on that one says Jack the final quarter of the year for US retailers is historically cyclically. That makes a lot of sense heading into Christmas and the holidays. What we're after is the standard annual cycle to be a positive boost augmented by interest rate cuts to give us a macroeconomic acceleration and get us rolling into twenty twenty five. Yeah, obviously a lot riding on that call next week. Well, I think it's the second to last call for the Reserve Bank for this year. Twenty five or fifty basis points seem to be the pick between most economists. I think the majority at the moment probably picking twenty five, but still a bit of data to come out before that decision is final. Right now, it's quarter past sixty with Jack Tame. This is News talks 'B. For more from Heather Duplessy Allen Drive, Listen live to News talks 'B from four pm weekdays, or follow the podcast on iHeartRadio.

Yeah right, that makes sense. Hey, thank you so much. Christina really appreciated that. As Christina Lung, who is the Deputy Chief Executive of the enzed AA, speaking of optimism in the retail sector in Australia, that there's real reason for optimism. So retail sales have actually rebounded up almost a percent compared to expectations, so almost double the expectations, which and less over there actually just putting down to the weather they reckon it's been so warm throughout August and Australia that actually retail sales have been almost twice as good, or the growth in retail sales has been almost twice as good as they had been anticipating. So we're going to catch up with Paul Bloxam from HSBC before seven o'clock. Yet his thoughts on that one says Jack the final quarter of the year for US retailers is historically cyclically. That makes a lot of sense heading into Christmas and the holidays. What we're after is the standard annual cycle to be a positive boost augmented by interest rate cuts to give us a macroeconomic acceleration and get us rolling into twenty twenty five. Yeah, obviously a lot riding on that call next week. Well, I think it's the second to last call for the Reserve Bank for this year. Twenty five or fifty basis points seem to be the pick between most economists. I think the majority at the moment probably picking twenty five, but still a bit of data to come out before that decision is final. Right now, it's quarter past sixty with Jack Tame. This is News talks 'B. For more from Heather Duplessy Allen Drive, Listen live to News talks 'B from four pm weekdays, or follow the podcast on iHeartRadio.