New Zealand consumer confidence hits 17-year low

Consumer confidence in New Zealand has plunged to a 17-year low amid soaring food and fuel prices and a sharp slowdown in the housing market, an economic survey showed Wednesday.
The Westpac McDermott Miller consumer confidence index fell to 81.71 in June, down from 96.5 in March and 110 in December, with a level below 100 indicating pessimists outnumber optimists.
The level in June was the lowest since 1991, when New Zealand was in recession. Economic growth data due to be released on Friday is expected to show the economy shrank in the March quarter, compared with the previous three months.
Westpac senior economist Donna Purdue described the latest drop in the index as "jaw-dropping".
"The highly publicised rise in oil prices in recent months will be playing a key role in the feeling of doom and gloom," Purdue said.
High interest rates and a sharp slowdown in the housing market had also dented consumer sentiment, she added.
Tax cuts due to come into effect from October and a boom for the country's important dairy exports could bring some relief later in the year, she said.
"In the meantime, there is plenty for consumers to be down about, and they will continue to look for ways to cut back on spending."