Economic conditions have remained chilly right across the country, Westpac says. File photo. Photo: Supplied / Elle McCammon
Most of the country has been in the grip of an economic cold snap, but warmer conditions may be coming, according to a Westpac bank report.
The roundup rates regional economies on a six temperature scale - between frosty and hot - but no region makes it out of the "cool" zone.
"Economic conditions have remained chilly right across the country, with households and businesses in every region reporting ongoing challenges," Westpac senior economist Satish Ranchhod said.
Four of the 11 regions surveyed, the top of the South Island and the West Coast, Bay of Plenty, and Northland rated frosty - the lowest.
Five regions, Auckland, Wellington, the lower North Island, Canterbury, and Otago rated cold - the second lowest.
Top ranked, with a cool rating, were Southland and Gisborne-Hawkes Bay.
Ranchhod said the overall assessment was that "there's still a lot of pain out there".
"Many families have been reining in their spending as cost-of-living pressures continue to bite. That's seen widespread falls in retail
sales and particular weakness in the hospitality sector."
"We've also seen continued softness in sectors like construction and manufacturing, with declines in both the amount of work being completed and forward orders."
He said few firms were hiring, and many had not been filling vacancies or cutting staff through restructuring.
Getting warmer
But Ranchhod said the economy was showing signs of getting warmer, with the tone of responses changing from downbeat to encouraging, and the pace of price rises easing.
"Perhaps the most notable change since our last survey was the sense that the worst is finally behind us."
"A number of businesses said that the start of the Reserve Bank's interest rate cutting cycle was a welcome relief, and they're optimistic that the fall in interest rates will help to stoke demand over the year ahead."
He said generally the South Island was less negative, because of improvement in dairying and horticulture, higher export prices, and higher tourist numbers.
In contrast the North Island was generally more downbeat with weak spending and job losses.