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ANZ-Roy Morgan New Zealand Consumer Confidence lifts in August to 126.2

ANZ-Roy Morgan New Zealand Consumer Confidence lifted in August. Moderation across the housing market is not impacting consumer sentiment. That’s a healthy sign. Buoyant consumer confidence points to a solid pace of spending-based activity. House price expectations cooled further.
SUMMARY

  • ANZ-Roy Morgan New Zealand Consumer Confidence lifted in August.

  • Moderation across the housing market is not impacting consumer sentiment. That’s a healthy sign.

  • Buoyant consumer confidence points to a solid pace of spending-based activity.

  • House price expectations cooled further.
Consumers remain in a buoyant mood. The ANZ-Roy Morgan Consumer Confidence Index lifted from 125.4 to 126.2, with sentiment well above its long-run average of 119. Once we adjust for the seasonality at this time of year (the cooler months often bring the same for sentiment), the index rose 2 points to its highest level since July 2014.

ANZ-Roy Morgan New Zealand Consumer Confidence Rating - August 2017 - 126.2

In terms of the details, the Current Conditions Index was unchanged at 124.9 while Future Conditions lifted 1 point to 127.1; both ‘steady as she goes’.

  • Consumers feel wealthier. A net 12% feel better off than a year ago. Views regarding their own financial situation in 12 months’ time lifted to +35 (+32 previously).

  • A net 38% believe it’s a good time to buy a major household item.

  • Perceptions regarding the economic outlook remain buoyant. Net optimism towards the economy one year out lifted from +23 to +25, and when assessing the five-year economic outlook, optimism eased from +23 to +21.
Moderation across the housing market is not taking the wind out of consumers’ sails. The economy is typically tied to the fortunes of the property market. Rising house prices lift property owners’ wealth and encourages spending, and the reverse also applies. Auckland house prices are falling but it seems consumers feel there is no need to batten down the hatches; consumer confidence remains elevated.

There are numerous reasons consumers’ boats are not being rocked.

  • Jobs are plentiful. The unemployment rate has fallen to 4.8%.

  • One man’s loss is another man’s profit. Falling house prices are good for those trying to get on the property ladder.

  • House prices outside of Auckland are still lifting, albeit more modestly.

  • Regional New Zealand is being buoyed by strong commodity prices; the South Island (excluding Canterbury) is now the most upbeat region.

  • The high NZD is keeping inflation low and major household items cheap.

  • Interest rates are still low and set to be lower for longer (though it shouldn’t be forgotten that this hurts savers).

  • The Budget put $2 billion on the table for families and the election lolly scramble is underway.
Buoyant consumer confidence points to an economy that’s still full steam ahead. Our confidence composite gauge (which combines business and consumer sentiment, and so covers both the production and spending sides of the economy) continues to flag very good economic momentum.

ANZ-Roy Morgan New Zealand Consumer Confidence Rating - August 2017 - 126.2

Click here to download the latest ANZ-Roy Morgan New Zealand Consumer Confidence Release PDF - August 2017.


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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.