Fall in consumer confidence points to "double dip"

Fall in consumer confidence points to a "double dip"

The latest Westpac McDermott Miller consumer confidence survey released today shows that consumer confidence has slipped back in the first quarter of this year. A leading Auckland retail group believes the country could be witnessing a double dip in confidence and economic performance.

"When we technically came out of recession last year everyone rejoiced and there was a bit of a rally leading into Christmas. We now risking the possibility of a double economic dip, with many New Zealand retailers now saying the first quarter of 2010 is turning out worse than the first quarter of 2009,” says Cameron Brewer, chief executive of the Newmarket Business Association.

"Consumers are taking a wait and see approach. Confidence is down, unemployment is up, petrol's up, house prices are down, and interest rates are set to start climbing from June. Fortunately for the consumer the high dollar is keeping the big ticket items affordable.

"Another two factors that are adding to consumer uncertainty, even subconsciously, are Auckland's imminent and massive amalgamation and the National Government’s second Budget, which given all the tax changes is lining up to be the most significant in 20 years."

"There is so much uncertainty out there, it's no wonder consumer confidence has slipped back. Budget day on 20 May can't come soon enough for retailers. New Zealanders are hungry for some direction. Confidence only ever returns when people are feeling better about themselves. The second half of 2010 is set perform much better," says Cameron Brewer.

ENDS

© Scoop Media