Credit card spending increases in March despite Omicron

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Business

Credit card spending up: New Reserve Bank figures show Kiwis using cards more in March. Photo/NZME

According to new data from the Reserve Bank, more Kiwis took out their credit cards in March as the Covid Omicron wave returned from its peak across the country.

Seasonally adjusted total New Zealand credit card billings were $3.8 billion in March, up 3.2% from February 2022.

Meanwhile, overseas billings on cards issued in New Zealand hit $0.4 billion in March as overseas travel restrictions eased.

This is the highest value of overseas billings recorded in a month since February 2020.

Domestic billings on cards issued in New Zealand were $3.6 billion, up 2.2%
from February 2022.

In March, the number of Omicron cases peaked in New Zealand, but traffic light alert levels were not eased until April.

Credit card billings in New Zealand had plummeted in February with the spread of Omicron. The slowdown was similar to that of August 2021, when the country was on Level 4 alert.

Seasonally adjusted total billings in New Zealand were $3.7 billion in February 2022, down 2.6% from January 2022.

By contrast, the latest figures from Statistics NZ for overall retail spending in March showed a decline of 1.3% ($77m). This followed a 7.8% decline the previous month.

The latest NZIER Quarterly Business Sentiment Survey found that 33% of businesses surveyed expect general economic conditions to weaken over the coming months on a seasonally adjusted basis, while 9% of businesses reported less activity in their own business.

A combination of Omicron, rising costs and uncertainty surrounding the war in Ukraine appears to have weighed on survey respondents in March.

The retail sector was now the most depressed of the sectors surveyed by NZIER, with a net 60% of retailers surveyed expecting general economic conditions to deteriorate.

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