Consumer confidence weakens but stays positive: Roy Morgan

Thursday 17th June 2010

New Zealand consumer confidence fell this month, while remaining positive, with more people saying it’s a good time to buy a major household item, according to the ANZ-Roy Morgan Consumer Confidence poll.

The measure fell four points to 122 this month and has slipped back from its recent peak of 131.4 in January. In trend terms, confidence has been broadly unchanged in the past four months.

The Roy Morgan poll broadly concurs with yesterday’s Westpac McDermott Miller Consumer Confidence Index, which rose to its second-highest level in the past three and a half years in the second quarter. Consumer spending has been a weak spot in an economy gaining tail winds from stronger commodity prices, having navigated through the global financial crisis in relatively good shape.

“Financially, consumers are yet to fully recover from the effects of the recession, but are getting close to doing so,” ANZ senior markets economist Khoon Goh said.

The gap between current and future conditions narrowed to 17 points this month, reflecting a 3.6 point increase in perceptions of current conditions to 111.8 and a nine point slide in future conditions to 128.8.

Those New Zealanders who deemed it a good time to buy a major household item rose seven points to 28, the highest in about two years. This may reflect the looming GST hike to 15% from 12.5% on October 1, which is expected to spur some consumers to bring forward their purchases to avoid the extra impost.

Expectations for inflation two years hence were unchanged at 3.8%, the survey showed.

Auckland remained the most upbeat region, with the June reading broadly unchanged from the previous month at 128.8. The South Island became less confident, dropping 14 points to 111.8 and overtaking Wellington as the least optimistic region.

Businesswire.co.nz

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