This driven by a decline in the survey's best spending indicator
The ANZ-Roy Morgan New Zealand Consumer Confidence has remained at low levels in July, down 1.8pts to 83.7, with the fall driven by the survey’s best spending indicator, which suggested consumers are indeed cooling their jets.
Inflation expectations recovered almost completely from last month’s sharp fall, lifting from 4.3% back up to 4.7%, but were still trending lower and remained well off their high of more than 6% in late-2021.
A net -25% of Kiwi consumers (down 1pt) believed their families were better off financially compared to this time last year, while an unchanged net 11% expected to be better off this time next year.
A net 39% of Kiwi consumers think now is a bad time to buy a major household item, plummeting by 12pt, to be back around its lows (excluding lockdowns) – a news that doesn’t bode well for retailers.
New Zealanders appeared to more optimistic about the nation’s economy, with sentiment for the economic outlook in the next 12 months up 2pts to a net -32%, with the five-year-ahead measure also increasing 2pts to a net +3%.
Expectations for house price inflation rose from 1.6% to 1.9%. Expectations were strongest in Canterbury, at 4.4%, but were at least 1% everywhere else.
The ANZ-Roy Morgan data showed that headline confidence would have plunged further if not for a sharp increase in Canterbury, which saw a sharp lift across all questions except for whether it’s a good time to buy a major household item.
“Households are being buffeted currently, with headwinds outweighing tailwinds,” said Sharon Zollner, ANZ chief economist. “The cost of living is an obvious headwind, though this shouldn’t be overstated, insofar as average incomes have broadly kept pace. The rapid rise in mortgage rates and the ongoing rollover from lower rates is another clear headwind.”
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