Equifax's quarterly report showed overall business credit demand was down 1.2 percent in the September quarter on a year ago. Photo: 123rf
Business credit demand is softer and mixed with solid growth in the accommodation and food services sector, offset by some weakness in the construction sector.
Credit data company Equifax's quarterly report showed overall demand was down 1.2 percent in the September quarter on a year ago, based on the volume of credit applications for trade credit, business loans and asset finance.
Asset finance to replace or upgrade facilities and machinery rose 7.2 percent on the year before, and there was a modest 0.3 percent rise in demand for business loans, but trade credit applications fell 8 percent.
Equifax New Zealand managing director Angus Luffman said credit demand had largely stabilised, but the results reflected continued market uncertainty.
"Despite strong demand through August, business loans and trade credit softened, at greater than seasonal rates, during September in the lead up to the election."
He said overall demand was between 10-12 percent below pre-pandemic levels.
The rebound in the hospitality sector showed in a 16 percent rise in demand in the accommodation and food services businesses, with rising demand also for transport businesses, and smaller growth for manufacturing and retail trade.
"A positive is that the accommodation and food services sector, which was heavily impacted by the pandemic, continues to show strong signs of demand recovery. In the September quarter we saw the highest quarterly volume in the sector in the last four years."
The biggest declines were in agriculture, forestry, professional, and construction demand, which were all down between 3 and 6 percent.