ANZ-Roy Morgan New Zealand Consumer Confidence up 1.6pts to 79.3 in April

ANZ-Roy Morgan New Zealand Consumer Confidence lifted 1.6pts 79.3 in April, still an extremely low level.

• The proportion of people who believe it is a good time to buy a major household item, a key retail indicator, lifted 1 point to -31.

• Inflation expectations eased from 5.4% to 5.2%. They have been bouncing around a narrow range for the last six months.

The ANZ-Roy Morgan Consumer Confidence Index lifted 1 point in April, remaining very subdued.

Turning to the detail:

• Net perceptions of current personal financial situations lifted 1 point from -26% to -25% with just under a quarter of New Zealanders, 24% (unchanged) now saying they are 'better off financially' than this time a year ago while just under half, 49% (down 1% points) say they are 'worse off financially'.
  
• Looking forward New Zealanders remain broadly positive with a net 6% expecting to be 'better off financially' this time next year, up 5 points on March. This includes 36% (up 1% point) who say they expect to be 'better off financially' this time next year compared to only 30% (down 4% points) who say they expect to be 'worse off financially'.
  
• However, a big drag on the index remains buying sentiment with a net 31% who think it’s a 'bad time to buy a major household item', up 1 point on March. Now only 24% (up 2% points) of New Zealanders say it is a 'good time to buy a major household item' compared to an increasing majority, 55% (up 1% point) who say it is a 'bad time to buy a major household item'.
  
• The largest negative drag comes from perceptions regarding the economic outlook in 12 months’ time which fell 4 points to -50% with only 10% (unchanged) saying they expect 'good times' for the economy over the next year and a rising majority of 60% (up 4% points) who expect 'bad times'. However, the longer-term 5-year-ahead measure recovered somewhat, lifting from -10% to -2% with 22% (up 3% points) now expecting 'good times' for the economy over the next five years compared to 25% (down 4% points) who expect 'bad times'.
  
• House price inflation expectations eased from 0.6% to 0.3%. They are strongest in the North Island excluding Wellington and Auckland (0.9%).
  
• One-year-ahead CPI inflation expectations fell back from 5.4% to 5.2%, with no trend evident.

Consumers continue to give very wary answers to questions about their financial wellbeing both now and into the future. The current conditions index was little changed at 71.7, while the future conditions index is somewhat chirpier at 84.4 (though still well under par). Households are concerned about the rising cost of living, particularly those with large amounts of debt. And while jobs are still plentiful, the economy is beginning to slow, and media articles about tougher times ahead are common.

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