New Zealand: Consumer confidence dips in March
The ANZ-Roy Morgan consumer confidence indicator dipped to 110.8 in March from February’s 113.1. Nonetheless, it remained comfortably above the 100-threshold that separates optimism from pessimism among consumers.
Consumers’ one-year and five-year general economic outlook deteriorated considerably, likely due to a worse-than-expected GDP reading for the last quarter of 2020. Moreover, the net proportion of households thinking it was a good time to buy major household items declined. On the other hand, households’ expectations about their financial situation in the next 12 months gained ground.
Commenting on the release, Sharon Zollnern analyst at ANZ, stated:
“Households are expecting a lot more inflation than businesses are. They often do, but now the difference is extreme. Businesses set the prices, but that doesn’t mean high household inflation expectations don’t matter. They make it easier for retailers to raise prices, and if the labour market is tight, can also impact wage negotiations.”