Consumer confidence starts to dip

Wednesday 23 June 2004

Higher interest rates and a falling dollar are starting to bite, with a big drop in the number of shoppers who think it is a good time to buy a fridge or furniture.

By The Landlord

The Westpac McDermott Miller survey of consumer confidence, out today, showed confidence dipped from 124 points in March to 121.7 in June. A score of more than 100 shows more optimism than pessimism.

While the picture was still positive for shop owners now, Westpac expected retail sales growth to slow from a rocketing 8 per cent in the past year, to just 2 per cent next year.

The Reserve Bank bumped interest rates up on June 10. Bank floating mortgage rates rose quickly to about 8 per cent, with the prospect they might go up even more late this year.

The latest Westpac McDermott Miller survey was carried out both before and after the Reserve Bank rate hike. It showed consumers were still generally upbeat, but less so than in March.

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