New Zealand: Consumer confidence increases sharply in January
February 2, 2018
The ANZ-Roy Morgan consumer confidence indicator shot up in January following three months of declines. The indicator reached 126.9 in January, up 5.1 points from the previous month. The index therefore sits further above the 100-point threshold that separates optimism from pessimism among consumers.
January’s sharp rise resulted from an increase in both the current and future conditions indices. The current conditions index improved notably to 8.1 points, reaching its highest level since 2007. Consumers were markedly more optimistic than in December about making major household item purchases, and their perception regarding the economic outlook for the next 12 months also improved, while the five-year outlook was stable from December’s print.
The improvement in consumer confidence was supported by the stabilization of the housing market and the gradual dissipation of policy uncertainty following September’s election, along with a robust labor market. However, some uncertainties about the future remained, which, according to ANZ Research, could be a sign of a lull in the economic cycle.
Author: Joffrey Simonet, Economist