NZ consumer confidence rises to 6-month high in November

Thursday 12th November 2015

New Zealand consumer confidence rose to a six month high in November as sentiment continues to recover from a slump to a three-year low in August.

The ANZ-Roy Morgan consumer confidence index increased 8 points to 122.7, marking the highest level since May. The current conditions index rose to 123.5 from 115.4, while the future conditions component increased to 122.2 from 114.6.

"From about the middle of the year consumer confidence plateaued below historical averages, and spirits were generally low," ANZ Bank New Zealand chief economist Cameron Bagrie said in his report. "The last few months have seen a turnaround, in what looks to be a well-timed run to Christmas."

The nation's economy appears set to move beyond consolidation and into a strengthening phase next year, buoyed by low mortgage interest rates and as weakness in some parts of the economy, such as the dairy sector, is offset by stronger sectors such as tourism, Bagrie said. The latest report shows all regions recorded a lift in confidence for a second straight month, led by Canterbury.

A net 9 percent of the 999 people surveyed said they were better off financially than this time last year and a net 30 percent expected to be better off in a year's time, the highest level in seven months.

Their view of the economic outlook improved, with a net 15 percent expecting good times ahead in the next 12 months, up from a net 2 percent last month and a turnaround from the net 16 percent seeing bad times ahead in the August survey. They were also more upbeat about the longer-term outlook with a net 21 percent seeing good times over the next five years, up from a net 18 percent last month and marking a six month high.

A net 38 percent of respondents said it's a good time to buy a major appliance, up from a net 31 percent last month and marking the highest level since June, helped by declining mortgage rates and a plateauing New Zealand dollar.

Annual inflation expectations rose to a 4 year high of 4.1 percent, ahead of the 3.6 percent pace forecast last month.

Meanwhile, expectations for house price inflation slipped to 4.4 percent, the lowest level this year, from 4.8 percent last month, as expectations for Auckland house prices cooled.

BusinessDesk.co.nz

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