Video | Agriculture | Confidence | Economy | Energy | Employment | Finance | Media | Property | RBNZ | Science | SOEs | Tax | Technology | Telecoms | Tourism | Transport | Search

 


RESEND: NZ consumer confidence falls

RESEND: NZ consumer confidence falls as interest rate hikes bite

(Fixes typo in third paragraph)

By Suze Metherell

May. 23 (BusinessDesk) - New Zealand consumer confidence fell to a seven-month low in May as two interest rate hikes and expectations for slower economic growth later this year sapped people's optimism.

The ANZ-Roy Morgan consumer confidence index eased to 127.6 this month, from 133.5 in April, and is 8 points off the pre-recession high. The current conditions index slipped to 123 from 130.3 and the future conditions index fell to 130.7 from 135.8.

"Higher interest rates are starting to bite," said ANZ Bank New Zealand chief economist Cameron Bagrie."The latest dent in confidence has translated into a slowing in expected economic growth over the second half of 2014. "This is hardly ringing alarm bells - it's akin to moving from a gallop to a fast canter."

Government data last week showed retail sales grew at a slower-than-expected pace in the first quarter of this year in the lead-up to the Reserve Bank kicking off a cycle of interest rate hikes in March and as the housing market slowed in response to restrictions on bank lending with small deposits. The Reserve Bank has signalled more interest rate hikes are to come and expects they will have a quicker impact with more borrowers on floating rates or fixed rates of one year or less.

The May survey of 1,047 people showed a net 10 percent of respondents were better off than a year ago, down from 13 percent in last month's survey. Looking out a year, a net 36 percent felt they would be better off, down from 40 percent the previous month. Perceptions of the broader economy fell for the fifth consecutive month, with a net 27 percent seeing better economic conditions ahead in the next 12 months down from 33 percent in April.

The biggest drop off in confidence was in those deeming it a good time to make a major household purchase, falling to a net 36 percent from last month's 47 percent.

Those thinking house prices would rise in the next two years remained static at 72 percent, predicting annual increases of 3.8 percent to 3.9 percent. Some 71 percent of respondents expect prices in general to rise over the next two years at an annual pace of 3.1 percent, slower than the 3.2 percent pace seen in April.

(BusinessDesk)

© Scoop Media

 
 
 
 
 
Business Headlines | Sci-Tech Headlines

 

Media: Julian Wilcox Leaves Māori TV

Māori Television has confirmed the resignation of Head of News and Production Julian Wilcox. Mr Maxwell acknowledged Mr Wilcox’s significant contribution to Māori Television since joining the organisation in 2004. More>>

ALSO:

Genetics: New Heat Tolerant Cow Developed

Hamilton, New Zealand-based Dairy Solutionz Ltd has led an expert genetics team to develop a new dairy cow breed conditioned to thrive in lower elevation tropical climates and achieve high milk production under heat stress. More>>

Fractals: Thousands More Business Cards Needed To Build Giant Sponge

New Zealand is taking part in a global event this weekend to build a Menger Sponge using 15 million business cards but local organisers say they are thousands of business cards short. More>>

Scoop Business: NZ Net Migration Rises To Annual Record In September

New Zealand’s annual net migration rose to a record in September, beating government forecasts, as the inflow was spurred by student arrivals from India and Kiwis returning home from Australia. More>>

ALSO:

Scoop Business: Fletcher To Close Its Christchurch Insulation Plant, Cut 29 Jobs

Fletcher Building, New Zealand’s largest listed company, will close its Christchurch insulation factory, as it consolidates its Tasman Insulations operations in a “highly competitive market”. More>>

ALSO:

Scoop Business: Novartis Adds Nine New Treatments Under Pharmac Deal

Novartis New Zealand, the local unit of the global pharmaceuticals firm, has added nine new treatments in a far-ranging agreement with government drug buying agency, Pharmac. More>>

ALSO:

Crown Accounts: English Wary On Tax Take, Could Threaten Surplus

Finance Minister Bill English is warning the tax take may come in below forecast in the current financial year, as figures released today confirm it was short by nearly $1 billion in the year to June 30 and English warned of the potential impact of slumping receipts from agricultural exports. More>>

ALSO:

Get More From Scoop

 
 
Standards New Zealand

Standards New Zealand

Mosh Social Media
 
 
 
 
 
 
 
 
Business
Search Scoop  
 
 
Powered by Vodafone
NZ independent news