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Personal finance fears continue for Australia & New Zealand

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Nielsen’s 2nd Quarter 2015 Global Consumer Confidence Index shows sharp dive in outlook
Kiwis significantly more confident than Australians

Sydney, Australia – 28 July 2015  – Consumer confidence in the Pacific has dropped significantly from the previous quarter, with Australia seeing a sizeable six point drop to 89 and New Zealand down three points to 99. While both markets experienced similar drops this quarter, the report shows that New Zealanders are more confident than Australians in all areas of consumer confidence.

Nielsen’s latest global Consumer Confidence Index shows that Australians are increasingly negative about their personal finances, with a huge nine point drop from 57 to 48 in the second quarter. New Zealand also experienced a four point drop from the first quarter from 62 to 58 when asked whether they have a positive outlook on their personal finances.

Our outlook on job prospects is also down, with two thirds (66%) of Australians and two-fifths (41%)of New Zealanders signalling a negative viewpoint. Likewise, a majority of Australian (60%) and New Zealand (53%) consumers believe it isn’t a good time to buy the things they want or need.

Despite significant drops from the last quarter in confidence around finances, jobs and buying, year on year comparisons show steady trends. The Consumer Confidence Index in Australia is up four points year on year, and buying confidence is up by two points from the second quarter of 2014. Positivity around job prospects remains stable, while confidence in personal finances dropped a single point from the same period last year.

In New Zealand, the Consumer Confidence Index remained stable at 99 from the second quarter last year, while a positive outlook on personal finances and buying confidence were both up by two points from the same period last year, to 58 and 43 respectively. New Zealand has experienced an upward trend in consumer confidence since 2013, remaining close to the 100 mark consistently.

Nielsen’s Pacific Managing Director, Chris Percy, believes there are multiple contributing factors to consumers’ economic confidence declines, but cautioned on looking at immediate trends without considering historical movements.

“Weak income growth, a slump in the Australian dollar and rising cost of living which is leaving more consumers with no spare cash are all contributing factors to the latest economic confidence declines. That being said, seasonality is also a contributor, as the winter months typically deliver below average results, and while the quarter is notably down compared to the start of the year, consumer confidence is up four points compared to the same period last year.”  

Hear more from Chris Percy in the video below:

Nicky Tuffley, Chief Economist at ASB Bank agrees that the negative outlook is likely temporary, stating “a note of caution about the economic outlook and job prospects has crept into New Zealanders minds recently, after a long period when economic growth has been solid.  Prices of New Zealand’s key export, dairy, have weakened further and rural New Zealand will feel pressure over the next year from weak farm incomes.  Earthquake reconstruction activity in Canterbury is now levelling off after a period of very strong growth.  But interest rates are now being cut and the New Zealand dollar is falling, factors that will help to support future growth.”

GLOBAL CONSUMER CONFIDENCE REMAINS STABLE
Global Consumer Confidence has stayed relatively consistent for more than a year, declining one index point in the second quarter to a score of 96, while the Asia Pacific region saw confidence increasing in only four countries and declining in nine others. The Philippines showed the biggest quarterly confidence increase of seven index points, rising to a score of 122—the country’s highest level on record. Confidence also increased one point each in India (131), China (107) and Japan (83) from the first quarter.

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ABOUT THE GLOBAL SURVEY OF CONSUMER CONFIDENCE AND SPENDING INTENTIONS
The Nielsen Global Survey of Consumer Confidence and Spending Intentions was conducted Feb. 23 – March 13, 2015 and polled more than 30,000 online consumers in 60 countries throughout Asia-Pacific, Europe, Latin America, the Middle East/Africa and North America. The sample has quotas based on age and sex for each country based on its Internet users and is weighted to be representative of Internet consumers. It has a margin of error of ±0.6%. This Nielsen survey is based only on the behavior of respondents with online access. Internet penetration rates vary by country. Nielsen uses a minimum reporting standard of 60% Internet penetration or an online population of 10 million for survey inclusion. The China Consumer Confidence Index is compiled from a separate mixed methodology survey among 3,500 respondents in China. The sub-Saharan African countries in this study are compiled from a separate mobile methodology survey among 1,600 respondents in Ghana, Kenya and Nigeria. The Nielsen Global Survey, which includes the Global Consumer Confidence Index, was established in 2005.

ABOUT NIELSEN
Nielsen N.V. (NYSE: NLSN) is a global performance management company that provides a comprehensive understanding of what consumers Watch and Buy. Nielsen’s Watch segment provides media and advertising clients with Total Audience measurement services across all devices where content — video, audio and text — is consumed. The Buy segment offers consumer packaged goods manufacturers and retailers the industry’s only global view of retail performance measurement. By integrating information from its Watch and Buy segments and other data sources, Nielsen provides its clients with both world-class measurement as well as analytics that help improve performance.  Nielsen, an S&P 500 company, has operations in over 100 countries that cover more than 90 percent of the world’s population. For more information, visit www.nielsen.com

Press Contact:
Jackie Helliker, +61 403 074 864, [email protected]