25 Jun 2014

Regional economic confidence declines

7:33 am on 25 June 2014

Economic confidence has declined in most regions, but economists say it remains buoyant.

Westpac's June quarter survey found consumers aren't as upbeat about the prospects for their local economy compared with the previous period, due to sharp falls in dairy prices and the effects of mortgage lending restrictions and rising interest rates on the housing market.

Some analysts, unions and business groups argue regions outside of the bustling Christchurch and Auckland are at risk of stagnating or going backwards.

But Westpac senior economist Felix Delbruck said its survey showed most regions were holding up well and the Reserve Bank was likely to raise interest rates for the fourth successive time next month.

He said regional confidence was still strong in quite a few regions, but not quite as strong as it was three months ago.

Mr Delbruck said the economy may have lost a little momentum since the start of the year, but it was still an economy that was growing at reasonably strong rates.