Sunny weather brings optimism

Hallenstein Glasson reports robust sales. Photo / Sarah Ivey

New Zealand consumer confidence rose for a second month in January as households grew more upbeat about the prospects for the future.

The ANZ-Roy Morgan consumer confidence index rose to 128.9 from 126.5 in December, reflecting elevated optimism that typically comes with the summer months.

The current conditions index edged up 0.7 of a point to 126.8, while the future conditions index rose to 130.3 from 126.8 in January. On a seasonally adjusted basis, confidence slipped 1.8 points to 125, still above the decade average of 119.

"Levels of confidence remain elevated and households are still optimistic over the future, suggesting that the domestic expansion has more legs," said ANZ Bank New Zealand economist Steve Edwards. "Increasingly, households believe that the future is going to be better."

Retailers have provided mixed reports over the Christmas trading season, with clothing chain Hallenstein Glasson reporting robust sales leading to a profit upgrade, while Warehouse Group warned of an earnings downgrade after unseasonal weather led to increased discounting.

The ANZ-Roy Morgan survey of 1001 people found a net 10 per cent said they were better off financially than they were a year earlier, up from 9 per cent in December, while a net 33 per cent expect to be better off in a year's time, up from 29 per cent.

Respondents expect house prices will rise at an annual 5 per cent pace over the next two years.