Consumer index maintains good level

Sharon Zollner.
Sharon Zollner
Consumer confidence is at robust levels and ANZ chief economist Sharon Zollner is looking further than the tight labour market to explain why.

The ANZ-Roy Morgan NZ Consumer Confidence Index, released on Friday, had confidence lifting from 126.9 in January to 127.7 in February.

Although it was still a few points off the September high, it was at a solid level, she said.

On a seasonally adjusted basis, the index remained eight points off its September high at 124.7.

After surging eight points in January, the conditions index fell four points in February. The future conditions index lifted another four points to 128 and had largely recovered ifs post-election dip.

Consumers continued to feel content about their financial situation, Ms Zollner said.

A net 15% felt financially better off than a year ago. The proportion of those who reported being worse off was the lowest in the history of the survey.A net 34% of consumers expected to be better off financially this time next year.

A net 40% said it was a good time to buy a major household item. Although down seven points, it was still at a strong level and should support durables spending, she said.

Perceptions regarding the economic outlook were steady at 21%. The five-year outlook lifted from a net 22 to 29.

Confidence lifted six points in Wellington and three points in regional North Island. It fell in the South Island.Auckland confidence was little changed. Wellington and the South Island, excluding Canterbury, were vying for the top spot, Ms Zollner said.

National house price expectations lifted from 2.9% to 3.1% and were the strongest in regional North Island, at 3.8%.

The gap opening up last month between responses to the current situation and forward-looking questions closed in February, she said.

The confidence composite gauge, which combined business and consumer sentiment, took a hit from the fall in business confidence. However, robust consumer confidence was providing some support.

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