National Bank chief economist Cameron Bagrie is taking a positive view of a plunge in business confidence in the wake of the Christchurch earthquake, saying it could have been a lot worse.
On the face of it, there's little to cheer about. A monthly survey of sentiment by the National Bank found pessimists outnumbered optimists, with a net 9% expecting worse times for the economy in the coming year.
That's a reversal from the 37% expecting an improvement in the previous month. It is the second largest monthly decline since the survey began in 1986.
But Mr Bagrie says more companies still expect their businesses to expand, albeit fewer than half the month before.
Fewer firms intend to invest, though the number fell only slightly. More now expect lower earnings and to axe jobs.
Mr Bagrie says the figures still indicate growth of 2% over the year ahead.
However, with pricing intentions edging up, Mr Bagrie says the survey is a reminder that inflation pressures remain.