Businesses are putting off investment decisions, as uncertainty about the pandemic sours economic expectations.
The latest Institute of Economic Research Quarterly Survey of Business Opinion shows a net 34 percent of firms expect a deterioration in general economic conditions over the coming months, as inflation worries rise in line with costs and prices.
A net 61 percent of businesses have reported increased costs in the December quarter - that's the highest level since June 2008.
The Institute's principal economist Christina Leung says the results point to inflation pressures remaining strong over the coming year, with more than half of businesses raising prices to cover those costs.
She spoke to RNZ Business reporter Nona Pelletier.
