Confidence drops and retail outlook weakens
ANZ-Roy Morgan New Zealand Consumer Confidence fell 4.1 points to 94.7 in July, continuing its zig-zag pattern.
The proportion of households thinking it’s a good time to buy a major household item – a key retail spending indicator – fell one point to -8, remaining very weak.
“The net proportion thinking it’s a good time to buy a major household item remains negative, implying real retail sales are likely to remain soft for now,” ANZ-Roy Morgan said.
Kiwibank’s latest savings research reinforces the weak sentiment, showing a clear divide in financial confidence. While 76% of under-30s have savings goals and 85% follow a budget, 63% of New Zealanders still struggle to save at all, mainly due to the high cost of living.
The softer household mood also comes as ANZ’s July 2025 Business Outlook shows only a modest two-point lift in headline business confidence to a net 48%, with expected own activity flat at 41% and past employment still weak at -13.
Inflation expectations rise to two-year high
Inflation expectations rose 0.2 points to 5.1%, the highest level since April 2023. Analysts noted that food price inflation of 4.2% year-on-year is likely contributing to the lift.
- Two-year-ahead CPI inflation expectations: 5.1%, up from 4.9%
- House price inflation expectations: 2.9% year-on-year, the lowest in over a year
Current conditions fall sharply
The current conditions index fell five points to 85.4, with net perceptions of current personal finances dropping 8 points to -21%, a very weak level.
- 23% of New Zealanders say they are “better off” financially than a year ago (down 2 points)
- 44% say they are “worse off” (up 5 points)
Forward-looking sentiment also softened:
- Future conditions index: 100.9, down four points
- Net 11% expect to be better off financially in a year
- 39% expect to be “better off” (down four points)
- 27% expect to be “worse off” (up four points)
Economic outlook remains muted
Perceptions of the 12-month economic outlook fell three points to -16%, while the five-year-ahead measure held steady at +7.
Read the ANZ-Roy Morgan report in full.
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