Consumer confidence in New Zealand has dropped to near-historic low levels, according to new data.
The Westpac McDermott Miller Consumer Confidence Index fell 11 points in the June quarter to a level of 82.2.
A level below 100 signalled the number of households that were pessimistic about the economic landscape outweighed those who were optimistic.
Westpac senior economist Satish Ranchhod said the drop left confidence about the economic outlook "only modestly above historic lows".
"New Zealand households are continuing to be buffeted by strong financial headwinds," Ranchod said.
"Recent months have seen hopes for an early reduction in interest rates as inflation has held up. Ongoing high borrowing costs, combined with a more uncertain labour market, is undermining consumer confidence."
He said 42% of households had said their financial position had deteriorated over the last year — while just 14% said it had improved.
"Lingering inflation pressures have poured cold water on the chances of near-term rate reductions from the RBNZ.
"Cuts in the Official Cash Rate are likely to be a 2025 story. That will have been a disappointment to those households who had been hoping for near-term relief on their borrowing costs."
Ranchod said pressures on finances and nervousness about where the economy was headed meant New Zealanders were "keeping their wallets shut".
"Even with strong population growth, retail spending levels have been falling in recent months, with households switching away from 'nice to haves' and towards value-for-money."
Confidence among men has dropped considerably by 12.6 points, sitting at an index score of 89.1.
Women were "much more" pessimistic, sitting at 75.4 – a drop of 9.3 points.
"Almost half of women see themselves as worse off financially than they were a year ago, compared with just under a third of men," the report said.
When asked about next year, both men and women were pessimistic about New Zealand’s economy, with around 25% expecting to be worse off.
Imogen Rendall, Market Research Director of McDermott Miller Limited, said: "Women are especially downbeat about New Zealand’s economic outlook, with almost half expecting bad times over the year ahead.
"This compares with around a third of men who are expecting bad times in New Zealand."
For those in paid work, confidence plunged by 14.3 points down to 83.6 this quarter. Those not in paid work also dropped 6.5 points down to 79.4.
"Two in five of those in paid work felt they are worse off financially than a year ago, while almost half of those who are not in paid work feel this way," Rendall said.
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