Consumers are the happiest they have been for 10 years, the Westpac McDermott Miller confidence survey shows.
"It should keep the cash registers ringing loudly for a while yet," said Westpac chief economist Brendan O'Donovan.
He said confidence was within a whisker of its all-time high in June 1994. That
reflected the lowest unemployment rate in 18 years, wages growth and cheap imported goods, thanks to the high dollar.
"They have enjoyed a temporary spike down in mortgage rates and, in most of the country, have just received new house valuations and so are feeling wealthier as well."
The consumer confidence index stands at 130.2, up from 125 in September. A reading over 100 indicates more optimists than pessimists.
It is just below its peak of 130.9 in June 1994.
A net 36 per cent of those surveyed expect the economy to improve in the next 12 months.
In this, they are at odds with economic forecasters, who are predicting a slowdown next year.
"This is the second highest result ever for this question and very impressive given that we are coming off a year of near-5 per cent growth in the economy," Mr O'Donovan said.
The proportion of respondents who feel better off than they were a year ago is at a record high.
"We think the main factor behind this is the resurgence in the value of the kiwi dollar.
"In terms of perceptions, lower DVD prices and the like have outweighed higher electricity prices and local body rates."
A net 23 per cent expect to be better off next year, up from 21 per cent of respondents asked in September.
The data suggested a solid first quarter next year for retailers, Mr O'Donovan said.
Retailers Association chief executive John Albertson said consumer confidence had been running high all year.
"When you've got a very positive economy and there's nothing much for the average consumer to grumble about, people stay very positive," he said.
Luxury car dealer Michael Giltrap said business was booming, but no more so than in recent years.
"We've had a good run in the last two or three years," he said.
