FX.co ★ New Zealand Consumer Mood Drops on Inflation Worries

In May 2025, the ANZ-Roy Morgan Consumer Confidence Index experienced a decrease, falling to 92.9 from April's 98.3, reflecting heightened consumer pessimism. This decline is primarily attributed to the persistently high inflation expectations that continue to erode household sentiment. Sharon Zollner, ANZ's chief economist, emphasized that while household inflation expectations don't necessarily align closely with actual inflation outcomes, the perception of high inflation can significantly impact consumer behavior. She pointed out that concerns about rising prices could lead to a cost-of-living crisis, ultimately reducing consumer spending. Even with a minor dip of 0.1%, inflation expectations remained high at 4.6%. This persistent concern over inflation underscores the economic challenges ahead, as consumer caution continues to rise.