Dairy farming's outlook is looking bullish, according to Rabobank's latest ''Rural Confidence Survey''.
While all agricultural sectors had increased optimism, dairy farmers led the charge with 61% of those surveyed expecting the economy to improve in the next 12 months.
Fifty-four percent of the 450 farmers surveyed expected the economy to improve in the next year, up from 28% in the previous quarterly survey. Only 8% expected the economy to worsen, compared with 29% in the last survey.
Federated Farmers president Bruce Wills said the survey - which was completed last month - mirrored the change in sentiment he had witnessed recently.
''It's been a tough, tough, year for many,'' Mr Wills said.
''And farmers are desperately looking for good news. The currency is one thing, but dairy prices are moving up and sheep and beef prices are moving up.
''Everything is trending in a positive direction.''
He was not surprised dairy farmers' confidence had rebounded, as the ''$7 payout is looking more and more concrete''.
Rabobank New Zealand chief executive Ben Russell said several factors had helped lift farmers' spirits, including higher dairy commodity prices and a potential supply shortage in lamb and beef following the drought.
The survey also showed the highest investment intentions among farmers since December 2011, with 32% of those surveyed expecting to increase investment in the next 12 months.