Kiwi consumers are feeling a whole lot better about the economy than their Australian neighbours across the ditch, MasterCard reports. However, New Zealand may just look good in comparison to Australia’s dire situation, as BNZ is reporting a grimmer outlook.
The MasterCard index score is ranked from 0 to 100, with 0 meaning a negative outlook and 100 meaning a maximum positive outlook.
Australians’ confidence increased more so than that of New Zealanders to 39.5 overall, but it is still behind the Kiwi figure of 57.7.
The MasterCard Consumer Confidence survey found Kiwis are feeling better than Australians overall in five areas: regular income, employment, economy, stock market performance and quality of life.
As well as this, consumer confidence increased significantly in men, those of a younger age and Auckland residents.
MasterCard New Zealand country manager Peter Chisnall says the results, combined with New Zealand’s steady unemployment rate, show Kiwis are more secure about the performance of their economy compared to Australia.
He says confidence in employment and their earnings is significant, as it is the difference between people saving and spending.
High confidence means consumers will be likely to spend more.
New Zealand ranked 12th in consumer confidence overall in the Asian-Pacific market, while Australia placed last at 18th.
This contrasts with the results found in ANZ’s Roy Morgan Consumer Confidence survey for July.
It found that consumer confidence cooled in July to its lowest level in nearly three years.
It reported regional North Island had the biggest slide and contributed this fall to stress within the dairy sector. Falls were also seen in Auckland and Wellington.
ANZ senior economist Philip Borkin advised to keep a close eye on New Zealand’s economic conditions, as it’s possible confidence will cool even further.
It’s still considered a good time to buy a major household item, but this too has dropped to the lowest reading in 18 months.
Consumer spending in previous months hasn’t been something to get excited about.
Electronic retail sales, which make up about 60 percent of total retail spending, rose 0.5 percent in June.
But sales flattened in core retail sectors (excluding fuel and vehicles).
Core spending was up just 0.1 percent in the June quarter, compared with an increase of 2.6 percent in the March quarter.
Meanwhile, online spending is booming.
BNZ reports online retail spend in June was up 19 percent from the previous year.
Spending at international sites was up 29 percent on June last year, while spending at local sites was up 12 percent.
Infometrics senior economist Benje Patterson said to The Register retailers shouldn’t be disheartened by these results.
“Given that employment conditions are still in relatively good shape and spending by visitors in the hospitality sector on the up, retail sales growth will remain in positive territory,” he says.