New Zealand consumer confidence eased only marginally in August, holding below the neutral 100 mark but sitting well clear of its April low, as households continue to work through the aftermath of an oil price shock even as longer-term optimism improves.

The ANZ-Roy Morgan Consumer Confidence index slipped 1 point in August to 98.0 — still below par, but 18 points above the low recorded in April. The series is a long-running monthly survey — the Westpac McDermott Miller gauge provides a quarterly cross-check on household mood — and readings below 100 mean pessimists outnumber optimists. The reading lands just days before the Reserve Bank of New Zealand's September 2 Monetary Policy Statement, where the Committee faces a genuinely contested choice between holding the Official Cash Rate and hiking further. New Zealand households are still cautious but increasingly optimistic about the years ahead, a steadier backdrop for the RBNZ as it weighs a hold or a hike on September 2.

The survey's breakdown shows a widening gap between how households feel today and what they expect ahead. The current conditions index eased from 88.5 to 83.4, while the future conditions index rose to 107.7. A net 21% of respondents said they were worse off than a year ago, though a net 22% expect to be better off next year — the strongest such reading since January. The five-year outlook rose to +13%, its best level since May 2021, suggesting households increasingly see recent difficulties as temporary.

Inflation expectations offered little fresh direction for policymakers. Two-year-ahead inflation expectations were little changed at 4.7%, still well above the RBNZ's 1–3% target band and unlikely on their own to sway the Committee. House price inflation expectations eased slightly, from 2.6% to 2.5%.

ANZ attributed some of the softness in current sentiment to higher petrol prices in August, though these have since stabilised, and noted that discretionary card spending is trending higher as Middle East disruption fades. Household spending accounts for well over half of New Zealand's economic output, which is why confidence surveys — read alongside hard data such as card transactions and retail sales — sit on economists' watchlists as a regularly tracked input rather than a decisive one.

The Reserve Bank raised the Official Cash Rate to 2.50% in July by consensus, and has since noted eased near-term inflation pressure following a partial reopening of the Strait of Hormuz. Economists remain divided over the September meeting, split between a further 25 basis point hike to 2.75% and a hold — a tension mirrored in this month's data between near-term caution and longer-term optimism.

For the RBNZ, the near-flat August reading provides little fresh signal either way ahead of the September 2 Monetary Policy Statement. The softer current conditions index points to lingering strain from earlier oil price shocks, even as the five-year outlook reached its best level since May 2021, suggesting households see current pressures as temporary rather than structural. With the survey published monthly, the coming releases will show whether that gap between present caution and improving expectations starts to close, whatever the Committee decides on the Official Cash Rate.