Regional confidence up and down: survey

Wanganui City Photo/File

It's a matter of swings and roundabouts when it comes to getting a taste of economic and consumer confidence across the Wanganui region.

A Westpac McDermott Miller regional economic confidence survey for the second quarter of 2014 shows that although economic confidence has slumped a little, consumer confidence was a little more robust.

The survey has been carried out since 1988 and as usual sampled households across the region and country in the first 10 days of this month. In Wanganui's case it has been collated in with both Manawatu and Taranaki regional council areas.

Dominick Stephens, Westpac chief economist, said economic confidence in the region had fallen and was now sitting below the national average.

Mr Stephens said the survey showed households expecting good economic times in the region over the year ahead fell from 37 per cent in March to 24 per cent in June. That meant it was sitting below the national average of 32 per cent.

"Economic confidence moderated for the second consecutive quarter in the region. But weaker dairy prices are likely to be felt keenly in this region," he said.

On the other side of the ledger, consumer confidence rose modestly from 115.1 points in March to 115.8 in June, even though that is still sitting below the national average of 121.2.

Mr Stephens said that confidence would please retailers, with people becoming more upbeat about their own finances.

In a primary producing area such as Wanganui-Manawatu-Taranaki the sharp fall in international dairy prices meant the dairy payout is forecast to be well down on last year's record-breaker.

"What's more, the Reserve Bank hasn't been shy in telling consumers that interest rates are set to rise much further from here," Mr Stephens said.

This was the second consecutive quarter where economic confidence had moderated in the region, he said.

"In Taranaki, turnover in the housing market has dropped fairly sharply although prices have remained buoyant, in contrast to Wanganui where house prices remain well below their 2007 peak."