Westpac’s consumer confidence survey has hit its highest in nearly two years, despite still being “well below” average.
The bank’s McDermott Miller Consumer Confidence Index rose 8.7 points in December to a level of 88.9.
A score below 100 means more New Zealanders are pessimistic about the economic environment than optimistic. The average is 109.
Westpac senior economist Satish Ranchhod said households were feeling a little more festive heading in the holiday season.
“Increasing numbers of New Zealanders expect the economy to strengthen over the coming year. They also expect their personal finances will improve over 2024.”
They were some easing in the “powerful headwinds” that had been buffeting in the NZ economy, he said.
“Inflation has started to cool, with prices for some necessities easing back. There is also a growing expectation that we are at, or close to, the peak in interest rates. That will be welcome news for many households who have seen their finances squeezed over the past few years.”
While households were feeling a bit more optimistic, “they aren’t throwing their wallets open just yet”.
Spending appetites remained weak going into the holiday shopping season. The number of households who thought it was a good time to make a major purchase was still lingering close to all-time lows.
Men’s confidence had jumped this quarter to 96.3, up 10.2 points. Women remained “deeply pessimistic" at 81.8, an increase of 7.1 points.
Confidence among different age groups this quarter, however, was “remarkably similar”.
Confidence among those aged 30-49 increased the most, rising 11.1 points to 87.8. Younger people aged 18-29 were the most confident with an index score of 88.0 - an increase of 5.2 points - and those aged 50+ also saw an increase in confidence of 3.1 points to 84.8.
