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ANZ-Roy Morgan New Zealand Consumer Confidence falls to 116.2 in May (down 3.8pts)

Consumer sentiment eased in May, though it remains elevated. Buoyant sentiment remains a positive sign for spending trends and the economy. House price expectations continue to rise, hitting a new high. While moving at a marginally slower tempo, New Zealand consumers are still in a good rhythm. The ANZ-Roy Morgan Consumer Confidence Index eased by 4 points in May to 116.2. In seasonally adjusted terms confidence eased from 117 to 115. That’s still in the groove.
SUMMARY

  • Consumer sentiment eased in May, though it remains elevated.

  • Buoyant sentiment remains a positive sign for spending trends and the economy.

  • House price expectations continue to rise, hitting a new high.
While moving at a marginally slower tempo, New Zealand consumers are still in a good rhythm. The ANZ-Roy Morgan Consumer Confidence Index eased by 4 points in May to 116.2. In seasonally adjusted terms confidence eased from 117 to 115. That’s still in the groove.

ANZ-Roy Morgan New Zealand Consumer Confidence Rating - May 2017 - 116.2

Key results across the May survey were:

  • More consumers still feel better off financially than not, although by a smaller majority. A net 5% feel better off compared to a year ago. Consumers’ perception of their wealth has been rocking and rolling between 0 and +12 for the past year and a half.

  • A net 34% believe it is a good time to buy a major household item. That’s down 4 points from April but is still a good rap.

  • The forward-looking indicators all eased a tad. Net optimism regarding the short-term economic outlook eased from +9 to +6. Optimism about the longer-term outlook was down from +28 to +23. A little bit of swing from month to month and not much more.

  • The Current Conditions and Future Conditions indices fell by 4 points and 3 points to 119.3 and 114.3 respectively. The levels are respectable and show more rhythm than blues. In seasonally adjusted terms, the Current Conditions Index was up ever so slightly, signalling we ‘cancan’ see good spending momentum across the economy.

Looking at the regional breakdown, Wellington takes poll position (with its highest reading for 11 months), whilst Auckland showed the largest fall (its lowest reading since August 2015). Unaffordable houses and traffic delays are no cakewalk. The least-confident consumers are in the South Island outside of Canterbury.

Once again we are left with an impression of consumers in a good mood. When you have an economy showing generally good vigour, that’s of little surprise. House prices are moving up and employment growth is strong. Income and wealth are on the rise. Typically that is a combination that would be accentuating more positivity. However, this looks to have been tempered somewhat in the month by rising petrol prices – and, we suspect, rising tensions over an accelerating property market. It may be good for those on the ladder, but it is not for those off it. Interest rates present the same dichotomy: lower interest rates are good for borrowers but not for savers. Those close to retirement will be re-evaluating future work/leisure plans.

Our Confidence Composite (which combines both consumer and business sentiment) continues to flag that good times remain ahead. It is suggesting GDP growth of around 3% for 2016.


ANZ-Roy Morgan New Zealand Consumer Confidence Rating - May 2016 - 116.2

  Click here to download the latest ANZ-Roy Morgan New Zealand Consumer Confidence Release PDF - May 2016.


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Related Research Reports

The latest Roy Morgan Consumer Confidence Monthly Report is available on the Roy Morgan Online Store. It provides demographic breakdowns for Age, Sex, State, Region (Capital Cities/ Country), Generations, Lifecycle, Socio-Economic Scale, Work Status, Occupation, Home Ownership, Voting Intention, Roy Morgan Value Segments and more.

You can also view our monitor of Quarterly New Zealand Unemployment & Under-employment Estimates.