New Zealand: Consumer confidence rebounds from a two-year low in second quarter
June 16, 2011
Consumer confidence recovered, as the impact of February's earthquake faded. The Westpac McDermott Miller consumer confidence indicator rose by 14.1 points to 112.0 points in the second quarter, well above the 97.9 points registered in the first quarter. The second quarter print fully recovered from the first quarter earthquake-related decline, which reflected households' concerns about their near-term economic prospects and marked the lowest level of consumer confidence in two years. At the current level, consumer confidence sits comfortably above the 100-point threshold, which indicates that optimists outnumber pessimists. According to the survey, the improvement in consumer sentiment was broad-based but was particularly evident in consumers' more optimistic assessment regarding the economic outlook for the next 12 months. While a net 6.7% of respondents continued to expect weak economic conditions over the next 12 months, the figure represented a notable improvement compared to the net 46.5% of respondents expecting weak economic conditions observed in the previous quarter. Moreover, consumer's perception of their purchasing power notably improved, with a net 26.0% of households reporting that they are in a position to buy major household items (Q1: net 12.5% of respondents).
Author: Ricardo Aceves, Senior Economist