Good news: consumer sentiment was little changed in September. That’s normally nothing to crow about. However, after the declines of late we’ll take stability as a positive. Levels are still afloat, being well above 100. Consumers’ expectations about the economy’s prospects over the year ahead improved in September. However, consumers feel marginally less positive about their current financial position compared to a year ago.
- Good news: consumer sentiment was little changed in September. That’s normally nothing to crow about. However, after the declines of late we’ll take stability as a positive. Levels are still afloat, being well above 100.
- Consumers’ expectations about the economy’s prospects over the year ahead improved in September. However, consumers feel marginally less positive about their current financial position compared to a year ago.
- House price expectations eased again in Auckland but rose in the rest of the North Island. Auckland house price expectations remain the strongest.
The consumer confidence ship has steadied. The ANZ-Roy Morgan New Zealand Consumer Confidence Index lifted 1 point in September from 109.8 to 110.8. This is well down versus the start of the year, but the level still suggests a steady course for the good ship HMNZ.
The September ANZ-Roy Morgan New Zealand Consumer Confidence survey suggests the economic ship is holding its course (our seasonally adjusted estimates were unchanged).
- Expectations regarding the economy one year ahead changed tack, rising from -16 – the lowest in over three years – to -12. This level still suggests consumers see rough waters ahead. Sentiment regarding the economy’s performance five years ahead unwound its 3-point fall in August to be back at +11.
- Those believing it is a good time to buy a major household item continued to lose ballast (+24, down from +27). This likely reflects the start of higher prices for imported goods due to the weaker NZD.
- A net 6% believe they are financially better off compared to last year, little changed from last month.
- The Current Conditions Index continues to trend down, easing from 117.2 to 114.9. The bow remains well above the waterline, however.
- The Future Conditions Index lifted from 104.9 to 108.1.
- Confidence (in seasonally adjusted terms) fell in Wellington but rose elsewhere.
Though one can never read too much into one month of data, it is encouraging that the falls seen in the previous four months took a breather in September. The level of confidence is neither elevated nor poor, though certainly has a less buoyant feel relative to prior years.
But while the ship has steadied, the New Zealand economy is still sailing into the wind.
Despite recent increases in global dairy prices, times will remain tough down on the farm for some time. The Canterbury rebuild appears to be peaking earlier than expected. Unemployment is rising. The NZD is falling – that’s great news for exporters but not for consumers who have become used to imported goods at bargain prices. Recent gyrations in global equity markets have likely caused some to reach for the life jackets.
That said, the crew is not about to abandon ship.
Lower interest rates and the lower currency will stimulate business. Lower commodity prices siphon money from producers to consumers. The Reserve Bank may not be so happy about house price increases broadening through the upper North Island but it certainly does support spending.
Click here to download the ANZ-Roy Morgan New Zealand Consumer Confidence Release PDF - September 2015.
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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.