Larry Williams Drive

The June ANZ Business Outlook survey showed firms are increasingly pessimistic about the outlook for activity and profitability.However, it is the ongoing issues of inflation and an economy running at capacity causing most headaches, not recessionary forces.The data would do nothing to ease RBNZ concerns about the potential for a wage-price spiral developing, said ANZ chief economist Sharon Zollner.Activity indicators were weaker across the board, the survey found.But "expected profitability" was particularly dire, said Zollner."Investment intentions are slipping. Employment intentions are holding up pretty well, but with the profitability outlook so pessimistic, one does wonder for how long this can remain the case," she said.Business confidence fell 7 points to -63 per cent in June, while expected own activity fell 4 points to a net 9 per cent expecting lower activity ahead.Despite recession talk, supply-side issues continued to dominate the list of firms' biggest problems, consistent with inflation pressur