The Westpac-McDermott Miller Regional Economic Confidence survey shows households are feeling a bit more confident about their regions’ future now that the new Government is firmly in place.
Confidence rose in nine regions in the March 2018 quarter, compared to only six in the previous quarter.
The biggest increase was in Auckland, which despite a recent lift in house prices, remains the most pessimistic the country. The second biggest was in the Bay of Plenty.
In contrast to Auckland, households in Wellington are the most optimistic in the country. In part, this is due to the change of government and what this might mean for public sector workers in the capital.
Meanwhile, Canterbury sits somewhere mid-table, with households still feeling confident about their economic prospects despite growing uncertainties relating to the slowdown in construction activity in the region.
The two regions where regional confidence fell were both in the South Island. Otago posted the largest drop in the March quarter. Most of this was likely due to a technical correction following a large increase in the previous quarter.
However, drought conditions and growing worries about how the region might deal with an expected increase in tourists may also have contributed to this lower reading.
The large fall in regional confidence in the Nelson/Marlborough/ West Coast region, which was enough to place it among the most pessimistic regions in the country, probably reflects the impact of ex-cyclones Fehi and Gita and the widespread disruption and damage they caused to the region.
- The Westpac McDermott Miller Regional Economic Confidence Index rose in nine out of eleven regions in the March 2018 quarter.
- Households in Auckland remain the most negative about their region’s economic prospects. Meanwhile, those in Wellington were the most optimistic.
- Confidence in some rural regions was affected by severe weather events, which impacted agricultural production and other aspects of the economy.
- Separately, consumer confidence (a measure of households’ views of their own economic conditions) increased in nine of eleven regions