Consumer confidence slips as caution prevails
New Zealanders still remain cautious about spending money.
BUSINESSDESK: New Zealand's consumer confidence eased in September as people remain cautious about spending money.
The ANZ-Roy Morgan Consumer Confidence measure eased to 111.9 points in September from 114.1 in August. The current conditions index rose 2 points to 112, while the future conditions index fell 2 points to 112.
Consumers still feel financially worse off than a year ago, with sentiment slipping 3 points to minus 5, while pessimistic perceptions towards the general economy were unchanged on minus 6.
Sentiment towards the economy five years from now rose 7 points to 23.
It is still seen as a good time to buy a big ticket item, with the net balance largely unchanged on 31 points.
ANZ chief economist Cameron Bagrie says consumers are reluctant to spend even as house prices continue to rise, interest rates remain low and labour income growth is solid.
"A listless trend in consumer confidence is not a bad thing. It suggests a continued focus on balance sheet repair and a lift in the savings rate," he says. "These are precursors of a more sustained upturn – eventually."
"While the lift in house prices continues to receive attention, it has not been accompanied by a marked rise in credit. Indeed, credit growth continues to track below income growth as people 'deleverage' and strike a halfway house between spending and saving."
The survey comes after New Zealand's Reserve Bank left its official cash rate unchanged at 2.5% yesterday, while delaying its forecast increase in the 90-day bank bill rate, seen as a proxy for the benchmark interest rate, until 2014.
Today's survey showed inflation expectations rose 0.3% to 3.4%.
Overall confidence among males eased 4 points to 116. Female sentiment was unchanged at 108.
On a regional basis Wellington recorded the largest lift in confidence, up 13 points to a nationwide high of 118. Canterbury rose 4 points to 116, while the remaining regions all weakened.
Hannah Lynch
Wed, 11 Jul 2018
Wed, 11 Jul 2018
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Consumer confidence slips as caution prevails
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