ANZ Business Outlook Survey provides a timely gauge of sentiment in the business community and expectations regarding the outlook. When businesses were asked what they thought about business conditions in the year ahead, a net 39% of businesses were pessimistic, down 12 points and back at November lows. Business confidence has been falling since June last year as economic headwinds have strengthened. Business sentiment is only one input into the decision-making that drives the economy. Firms' expectations of their own activity are a better gauge of future GDP growth. Firms' views of their own activity dipped from +14 to +9 in June but remain positive. Looking at own activity by industry, retailers remain the least positive (+6), while manufacturers are the most upbeat (+16).