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Elevate Magazine
August 16, 2024

Canterbury Businesses Breathing a Sigh of Relief After OCR Announcement

a small kiwi business meeting with diverse people auckland, new zealand.
A small kiwi business meeting with diverse people Auckland, New Zealand.

Canterbury businesses are experiencing a sense of relief following the Reserve Bank’s recent announcement to lower the Official Cash Rate (OCR) to 5.25%. 

Leeann Watson, the chief executive of Business Canterbury, says, “Since February 2023, when inflation and interest rates outpaced labour market constraints, cost pressures have consistently taken the number one spot in business concerns, according to our quarterly survey of over 400 businesses in Canterbury.”

“In May, 38% of businesses surveyed were facing significant impacts from rising costs, primarily driven by interest rates and inflation, alongside wage costs.” 

“This interest rate drop not only provides immediate relief but also signals that inflation is really starting to fall. We anticipate this will be reflected in some guarded optimism and potentially improved business confidence as we open our next quarterly survey for responses later this week.”

Business Canterbury acknowledges that while there has been a minor advancement towards cost stability today, challenges still persist.

“There is still a steep hill to climb; however, there is now light at the end of the tunnel, and for that alone, we should take some comfort today,” said Watson.

“Canterbury businesses have shown and will continue to show remarkable resilience as we navigate what has felt like an elastic band economy over the last four to five years, and looking ahead into next year as we hopefully enter a period of economic recovery.”

Canterbury businesses are urged to take part in Business Canterbury’s upcoming quarterly survey, which aims to assess shifts in business confidence and economic activity following the Reserve Bank’s announcement.