Consumer sentiment lifted in September and the increase goes beyond typical ‘spring-cleaning’. Consumers are feeling more confident about the future as well as remaining upbeat about the right here and now. House price expectations hit a new high.
Things blossom in spring and that’s one message from this month’s consumer confidence survey.
- Consumer sentiment lifted in September and the increase goes beyond typical ‘spring-cleaning’.
- Consumers are feeling more confident about the future as well as remaining upbeat about the right here and now.
- House price expectations hit a new high.
The ANZ-Roy Morgan Consumer Confidence Index increased from 117.7 to 121.0. Our seasonally adjusted estimate also showed a rise of 3 points, lifting from 122 to 125, which is the fourth consecutive increase and the highest reading since January. There is therefore more blush to the increase than spring pollination alone.
The movers in this month’s survey relate to expectations about the future.
The Current Conditions Index was largely unchanged (from 124.3 to 124.1), while the Future Conditions Index rose from 113.4 to 119.0.
The economy continues to bear fruit so it’s of little surprise to see consumer confidence growing.
- Forward-looking indicators bloomed. A net 31% expect to be better off financially in 12 months’ time, up 6 points on the month prior. Net optimism regarding the short-term economic outlook lifted from +5 to +12. Confidence regarding the long-term economic outlook increased from +10 to +14.
- Concurrent spending indicators were largely unchanged and continue to flag solid spending prospects ahead. A net 11% feel better off compared to a year ago, which is unchanged on last month’s reading. Consumers’ enthusiasm to buy a major household item continues to thrive, at a net 38%.
Annual GDP growth has accelerated to 3.6% and the unemployment rate has fallen to 5.1%. House prices have a rosy tint and dairy prices are coming into bud. There are still cash-flow pressures in dairying but less negative is an improvement. While a strong NZD may be a negative for exporters, it’s propagating cheaper prices for consumers.
Our confidence composite gauge
(which combines business and consumer sentiment into one gauge) continues to flag a solid-to-strong pace of GDP growth over the coming months.
Four percent real GDP growth is in prospect. At that pace, the economy will eat into spare resources. Skill shortages will become an increasing challenge for businesses. But that is a better problem to have than insufficient sales and it should push wages higher, another positive for consumers.
Click here to download the latest ANZ-Roy Morgan New Zealand Consumer Confidence Release PDF - September 2016.
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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.