NZ: Consumer confidence posts seventh decline in the past nine quarters - Westpac

Satish Ranchhod, Senior Economist at Westpac, notes that the New Zealand’s consumer confidence has fallen for a second quarter and is now well below the peak reached in 2014, and is below its long-run average.

Key Quotes

“New Zealand households have become increasingly nervous about the economic outlook. The Westpac McDermott Miller Consumer Confidence Index fell to 106.0 in June (versus 109.6 in March). That’s the seventh decline in the past nine quarters, and leaves confidence at below average levels.

While households are feeling a little better about their current financial position, there has been growing pessimism about the economy’s trajectory. The number of households expecting favourable economic conditions over the next year has fallen for a second quarter, and the number expecting positive economic conditions in five years time has plummeted to the lowest level in 25 years.

This degree of nervousness about the economic outlook has historically been seen when the economy is in recession. But as last week’s GDP figures revealed, the economy is actually growing at a firm pace, with growth in the year to March coming in at 2.4%. And signs are that growth will continue around this pace for some time.”