Bay national leader again for economic confidence

Group managing director of Farmer Autovillage Mike Farmer has been busy as more people are buying big ticket items such as cars. Photo / File

The bay of Plenty has been revealed as the most economically optimistic region in New Zealand for the second quarter running.

Buoyant retail spending, a stronger kiwifruit industry and increasing house prices have been big drivers behind the boosted confidence, revealed yesterday in the Q3 Westpac McDermott Miller Regional Economic Confidence survey.

The Bay ranked the highest with a confidence level of 25 per cent, following the 26 per cent recorded last quarter.

Areas such as Southland and Taranaki/Manawatu-Whanganui, which are both heavily reliant on the dairy sector, ranked at the bottom of the list with -36 per cent and -15 per cent respectively.

However, the consumer confidence category fell in all 11 regions in the September quarter, including a drop of -8.9 per cent in the Bay of Plenty.

Industry economist David Norman said most Bay of Plenty industries were heading in the right direction or at the very worst, staying stable.

"Retail spending and house prices in Tauranga are rising, which is a reflection of how people are seeing things. Vehicle spending and people buying commercial vehicles means people are quietly confident about the business market," Mr Norman said.

"People are choosing to make major investments, which they don't tend to do if they are worried about having a job a few months down the line."

Mr Norman said the survey was an important reflection of local community and business.

"These have an immediate flow-on effect on real people in real jobs ... the travel agents, the car salesmen, the Harvey Norman salespeople."

Group managing director of Farmer Autovillage Mike Farmer said his team had been busy and encouraged people to make the most of it while the economy was strong.

"If you overlay GDP and ups and downs over the years directly with new registrations, it almost follows it line by line," he said.

"But we've got to bear in mind Tauranga and the Bay of Plenty has had its challenges. A couple of years ago we were dealing with Psa, now that has come right. Everything happens in waves, in cycles. We've got to make the most of it when the cycle is strong," Mr Farmer said.

"Tauranga has strategically positioned itself in a really good position to attract Aucklanders moving here and attract businesses relocating. It makes economic sense."

Tauranga Chamber of Commerce chief executive Stan Gregec said he was seeing the confidence driving investment in employment, building and business growth in the short-term and beyond.

"There's also a mood that things are really happening here, and it's a great place to live and work. And we're still seeing Aucklanders making the move as people realise Tauranga offers great value and opportunity, without being too far away. We're noticing many new people at the chamber's networking events looking to make new connections and talking about establishing new businesses."

What is the Regional Economic Survey?
The regional economic confidence is the balance of households expecting good, as opposed to bad, economic times in their region over the coming year, as a percentage of total number of households. The survey was conducted between September 1 and 11, with a total sample size of 1550.

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