Household Spending Tracker Confirms Lockdown Trends
Kiwibank’s latest Household Spending Tracker for the September quarter shows that some lockdown habits are becoming entrenched as more New Zealanders shift to online and contactless spending while working from home becomes more common.
The Kiwibank Economics team has drawn conclusions from aggregated transactional data from Kiwibank debit and credit cards.
With Auckland about to re-join the rest of the country in Level 1, Kiwibank Chief Economist Jarrod Kerr said the city had coped better with the latest lockdown.
“Spending fell, with traditional service business most affected. But the overall drop in spending was unlike the first. Businesses and households have quickly learnt to trade in a world with limited face-to-face contact. Many have re-jigged their business models to accommodate social distancing and the shift to digital. We’re getting better at living with alert levels.”
Key spending trends from the data:
- we’re spending a lot more on fruit and veges as we eat out less
- gambling and alcohol spending has elevated to a higher level
- spending on online entertainment continues to surge
- time at home means more spending on DIY and home furnishings
- spending on transport is not back to pre-Covid levels as employers support staff working from home
“As New Zealand rolls back the restrictions and Auckland re-enters Level 1 this week, we’re expecting another bounce in spending.
“However, the unemployment rate is expected to rise in the coming months. Companies have failed, and more may fail. The wage subsidy has supported many business and households. But that lifeline is coming to an end. More job losses are expected. Consumer confidence could wane (further), with more subdued spending. The pace of our economic recovery may slow as a result.
“More is needed, especially from the Government, to spur activity. The good news is, they’re able to deliver. The Covid Response and Recovery fund is still looking rather plump.
“The decline in personal incomes across US households and slowing consumption growth also sounds a note of caution for the New Zealand economy over coming months,” said Jarrod Kerr.
The September Quarter Household Spending Tracker is attached and can also be found here.