Consumer confidence falls in November

We feel worse off financially now, than we did a year ago – the latest measure of consumer confidence indicates.

The November ANZ-Roy Morgan NZ Consumer Confidence measure fell to 109 from 112.2 last month, suggesting global jitters could be starting to test the relative resilience seen in New Zealand to date.

It’s the third consecutive monthly fall in the index to its lowest level since May, with confidence now tracking below the historical average of 118.1.

But ANZ said the latest fall should not cause too much alarm – matching declines in other business surveys and with the index still in optimistic territory overall.

Points to note:
- The November survey was taken after the Rugby World Cup final, suggesting consumers were not carried away by the All Blacks’ victory.

- The current conditions index fell 4.2 points to 100.6, just marginally above the neutral level, while the future conditions index, which has been coming off early 2010 highs, fell 2.5 points to 114.6.

- Of the five components that make up the overall measure of confidence, four recorded declines. The largest drop was for perceptions of households’ current financial position, which fell from -9 to -18, reversing most of last month’s ten-point improvement.

- Among the regions, confidence in Auckland fell the most, easing from 119.1 to 112.8 – surprising given the city hosted the business end of the Rugby World Cup, experienced strong employment growth in September and has the better performing property market.

- Wellington is now the most optimistic region at 113.5, down from 114.4.

- Males continue to be more optimistic than females, although male confidence fell nearly 7 points to 111.7 while female confidence was steady at 106.4.

- Inflation and house price expectations both eased for the second month in a row. Households expect general inflation to average 3.2% per annum over the next to years, down from 3.4% last month. House price expectations over the next two years fell from 2.7% to 2.3%.

- Cautious consumer sentiment heading into the end of the year signals more testing times for the retail sector.