HomeNEWSConsumer confidence falls again, but still optimistic

Consumer confidence falls again, but still optimistic

Consumers remain downbeat about the future of the economy, but are more upbeat about their own financial situations.

The Westpac McDermott Miller Consumer Confidence Index eased 0.3 points to 103.5 in the June quarter, after a 5.3 point fall in the previous quarter.

A reading above 100 signifies optimism and the historical average of the series is 111.8.

Westpac senior economist Satish Ranchhod said slowing economic growth seemed to be worrying households, with fewer saying it was a good time to buy a big-ticket household item, such as furniture or appliances, and fewer reporting spending on entertainment and dining out.

“The continued slide in household confidence follows a more general cooling in the economy over the past year, and households are feeling it.

“Weakness in the housing market is also likely to be a major factor dampening consumer sentiment, particularly in areas like Auckland,” Mr Ranchhod said.

Consumers were less negative about their own current financial position and their future outlook.

Those aged over 50 were the most downbeat, with those under 30 the most optimistic in five years, with the changing housing market being seen as the main driver.

“For older New Zealanders, who are more likely to be home owners or property investors, these developments have raised a number of concerns about their financial position,” Mr Ranchhod said.

“In contrast, for many younger New Zealanders who are trying to get their foot on the property ladder, the slowdown in the housing market and low interest rates means that home ownership is now looking much more affordable.”

Wellington was clearly the most optimistic region, followed by Otago, while sentiment turned negative in Waikato, Bay of Plenty, and Southland.

This story originally appeared on Radio NZ.

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