Westpac McDermott Miller Consumer Confidence, September Quarter 2022

The Westpac McDermott Miller Consumer Confidence Index rose 8.9 points in the September quarter to a level of 87.6. While that is up from the record lows seen earlier in the year, confidence remains weak. There are still many more New Zealanders who are pessimistic about the economic environment than those that are optimistic.

“It’s hard to describe the mood in the country as anything but grim,” commented Westpac Senior Economist Satish Ranchhod. “Households’ finances are being squeezed by the rise in living costs and higher mortgage rates. The pressure on household budgets has been especially pronounced for those on lower incomes.”

“The pressure on household finances is set to become even more stark over the next few months,” noted Mr Ranchhod. “The Reserve Bank has been hiking the Official Cash Rate at a rapid pace, and further large increases are on the cards before the end of this year. Higher interest costs are already weighing on the housing market and spending. We’re forecasting further softness over the next few months, especially in areas like durables spending.”

“Once again, looking across the different demographic groups, there are some clear contrasts. Men’s confidence has jumped this quarter to 92.1 (up 13.1 points,) while women remain heavily pessimistic at 83.3 (an increase of just 4.8 points). While both men and women are similarly concerned about their personal finances and New Zealand’s short-term economic prospects, men are much more bullish about New Zealand’s longer term financial prosperity,” noted Imogen Rendall, Market Research Director of McDermott Miller Limited.

“Confidence amongst younger people aged 18-29 has also increased markedly to 116.8. Driving this is the view of many in this age group that they are better off financially compared with a year ago, combined with the expectation that things will continue to improve for them personally over the next 12 months. In contrast, confidence of those aged 30 to 49 has only increased 7.1 points to 84.2 and those aged 50 plus remain almost as pessimistic as they were last quarter (up just 2.0 points to 80.0),” said Ms Rendall.

A full description of the background and specifications of the survey are attached. The survey was conducted over 1-12 September 2022, with a sample size of 1,559. An index number over 100 indicates that optimists outnumber pessimists. The margin of error of the survey is 2.5%.

Acknowledgement

The Westpac McDermott Miller Consumer Confidence Survey and Index is owned by McDermott Miller Limited. Westpac McDermott Miller should be acknowledged as the source when citing the Index. Graphs supplied may be reproduced by the news media provided the Westpac McDermott Miller logo remains inset.

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