NZ consumer confidence dips in February, remains elevated

Thursday 19th February 2015

New Zealand consumer confidence dipped in February while remaining elevated in the face of low interest rates and cheaper fuel.

The ANZ-Roy Morgan consumer confidence index fell 4.9 points to 124 in February, snapping two months of gains, to remain at elevated levels. The current conditions index slipped 3.8 points to 123 and the future conditions index fell to 124.6 from 130.3.

"We're not reading too much into the dip - though it is interesting that lower interest rates and petrol prices have not yet engendered the usual Pavlovian response," ANZ Bank New Zealand chief economist Cameron Bagrie said in his report. "Buoyant levels of consumer sentiment augur well for the economic expansion."

Government figures this week showed retail sales rose 1.7 percent in the final three months of 2014, beating estimates, as cheap credit and an improving jobs market encourages consumers to spend.

The ANZ-Roy Morgan survey of 1.003 people found a net 40 percent of respondents think it's a good time to buy a major appliance, down from 44 percent in January, while a net 6 percent said they were better off now than they were a year ago and a net 28 percent expect to be better off in the coming year. In January, a net 10 percent of respondents said they were better off now than a year ago, and a net 33 percent anticipated being better off in a year's time.

A net 24 percent of respondents expect good economic conditions in the coming 12 months, down from 29 percent in January, and a net 22 percent see good times over the next five years, compared to 29 percent a month earlier.

Respondents said they expect consumer prices to rise at an annual pace of 3.2 percent over the next two years, down from 3.7 percent in January, and predict an annual 4.5 percent rise in house prices over the next two years, down from 5 percent a month ago.

BusinessDesk.co.nz

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