Your Christmas presents might not be as flash this year.
The economists at Westpac have spotted a clear downward trend in consumers' expenditure on gifts.
They have confirmed what many people may be thinking, that Christmas presents this year will likely cost less than last year because of the economic
downturn.
Most consumers expect to either hold steady or reduce spending on gifts this year compared to last year, according to answers to additional questions in the regular Westpac McDermott Miller Consumer Confidence survey.
About 48 per cent expect to spend less and 42 per cent to spend the same. Just 7 per cent plan to spend more than last year.
It is the same across the country, with all regions showing caution. Rural consumers are the most cautious, with just 6 per cent saying they will spend more on gifts this year. Metropolitan consumers are the most upbeat, with 8 per cent planning to spend more and 45 per cent planning to spend less. There wasn't a separate figure for Auckland.
"The reluctance to spend more this year is likely to reflect consumers' continued caution around current economic conditions and still tight cash flows," the survey said.
The survey's usual measure of confidence for the December quarter found that 21 per cent of respondents felt worse off financially compared to last year.
The good news is that New Zealanders appear to be far more generous in Christmas gift giving than Australians even though the Australians are paid more.
The planned average "Christmas spend" by New Zealanders is in excess of $500, while in Australia it is A$443.
"New Zealanders appear to be far more generous in gift giving than Australians, particularly after taking into account much higher incomes in Australia," Westpac said.
Overall, by gender males are less cautious toward Christmas spending, while a breakdown by age group found people between the age of 30 and 39 are the most cautious, with 53 per cent saying they will spend less.
- NZPA
