Consumers are the least confident they have been for two years, the quarterly Westpac McDermott Miller survey has found.
The survey's index fell 4.3 points to 113, its lowest since March 2013 and barely above its average 111.5 reading in the 26 years the survey has run.
Not all itsindicators softened, however.
"The net percentage [of respondents] saying their financial situation had improved over the past year rose from minus 1.4 per cent to 1.4 per cent, while the net percentage saying it was a good time to buy a major household item rose from 27.8 per cent to 28.8 per cent," Westpac economist Felix Delbruck said.
"Both these responses are still comfortably above average, though down slightly from their recent peaks in early 2014."
But forward-looking questions elicited more downbeat responses.
The net percentage expecting their own finances to improve in the year ahead fell four points, from 9.8 per cent in March to a below-par 5.9.
And the net percentage expecting mainly good, rather than bad, economic times in the year ahead plunged 19 points, from 23.8 per cent in March to 4.8 per cent.
"Unsurprisingly, the decline in consumer confidence was larger in rural regions than in urban centres, but the difference was not particularly large," Delbruck said.
The drop was in line with other signs the economy has come off the boil, including softer business confidence and a slowdown in consumers' use of plastic cards.
"Consumers may be distinctly less upbeat about the economic outlook than they were three months ago, but they haven't battened down the hatches," Delbruck said.
But the reality of a low dairy payout was only just starting to affect farmers' cash flows.
"The survey also won't fully reflect the Reserve Bank's recent rate cut, which occurred when about 75 per cent of survey responses had already been collected and the subsequent lurch lower in the exchange rate."
He said lower mortgage rates would bring relief but the reality of a lower exchange rate would hit as imported goods started to cost more.
