BNZ: This lockdown could be easier on economy

09:27, Sep 09 2021
CHRISTEL YARDLEY/STUFF
People were out to enjoy things they hadn't been able to do in higher alert levels, including breakfast at cafes and visits to the barber.

A shift to lower alert levels for much of the country has prompted an increase in spending, BNZ data shows.

The bank’s card data showed spending plummeted as the country went into lockdown but the reduction was less than during the level 4 period last year.

Then, in the week to September 3, card spending increased 12 per cent compared to the week before.

Diane Brown, left, and Karin Porter shopping on day one of lockdown level 2.
Valentina Bellomo/Stuff
Diane Brown, left, and Karin Porter shopping on day one of lockdown level 2.

BNZ chief economist Paul Conway​ said the increase suggested the economic impact of this lockdown could be less than in 2020.

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Spending is still 37 per cent below pre-lockdown levels, but Conway said there was “room for optimism”.

ECON TALKS
An immediate jump in Jobseeker numbers in Lockdown 2.0.

“At the same point in the nationwide lockdown in 2020, card spending was 61 per cent below the pre-lockdown average,” he said.

“We continue to see online spending growing too, suggesting that people and businesses may be more adept at operating online, which could be helping to soften the economic impacts.”

He said the spending revival could reflect less job insecurity than seen last time, and that the level 4 lockdown period was shorter for most of the country.

“With most of the country now at Covid-19 alert level 2, it’s expected that spending would rise, but with our biggest city and the centre of the economy still in level 4 that rise will be somewhat sluggish.”

Auckland is set to stay at level 4 until at least next Wednesday.

Conway said the drop in spending relative to pre-lockdown levels ranged from 63 per cent in Marlborough to 33 per cent in Tasman. The Auckland and Wellington regions had spending declines of 40 per cent and 41 per cent respectively.

Delivereasy driver Sunita Torrance has been busy delivering alcohol during Level 4 lockdown.
SIMON O'CONNOR/Stuff
Delivereasy driver Sunita Torrance has been busy delivering alcohol during Level 4 lockdown.

Paymark figures confirm the large drop in consumer spending during the two weeks of nationwide level 4 lockdown.

Eftpos electronic transactions were on average down 82 per cent amongst non-food retail stores.

Trade Me reported last Thursday that “boredom-busting searches” increased this lockdown. The increase was mainly in gaming software.